Oral Answers to Questions

WALES

The Secretary of State was asked—

Health Services

Adam Price: What recent discussions he has had with the National Assembly concerning the specialised health services commission for Wales consultation paper.

Paul Murphy: I have frequent meetings with the First Minister of the National Assembly for Wales, and health is a matter that we regularly discuss.

Adam Price: The Secretary of State will be aware of the strength of feeling in west Wales about the proposal to centralise paediatric services in University hospital Cardiff. He will also be aware of the South Wales Evening Post petition, which has received more than 72,000 signatures. How has the specialised health service commission allocated its budget to date between the different regions of Wales? Does he agree that the Labour and Liberal Democrat Administration in Cardiff should base their health strategy on networks of excellence that are accessible to patients in all parts of Wales, not just to those in Cardiff and the south-east?

Paul Murphy: Of course I cannot tell the hon. Gentleman the details of how the specialised health service commission for Wales operates because that is a matter for the National Assembly, not the Government. I agree that we need centres of excellence throughout Wales, but I am sure he is aware that the commission, which was established by the health authorities in Wales, is composed of specialists and they are giving the issues careful consideration. No doubt he is also aware that the matter is subject to public consultation. I am aware of the strength of feeling that he and other hon. Members have about the issue, but we must await the verdict of the consultation.

Donald Anderson: My right hon. Friend will be aware that I have lobbied him on the deep anger that exists in Swansea and south-west Wales because of the threat to the paediatric neurosurgery unit at Morriston in my constituency. The anger is evidenced by the magnificent campaign of the local newspaper, the South Wales Evening Post, which has received more than 70,000 signatures. Does he realise that many local medics say that the consultation process is flawed? Does he agree with me and, I hope, the First Secretary that devolution should not mean centralisation in Cardiff? Centralisation was wrong in London; it is equally wrong in Wales.

Paul Murphy: Devolution of health services to local communities is a main feature of the new reorganisation of the health service in Wales. That is what it is about, and I agree entirely with my right hon. Friend on that. I know he understands that we have to balance the importance of achieving excellence in the delivery of medical service, which is recommended by the experts in that sector, with the issues that he raises. I am sure that his concerns, together with those of other hon. Members, will be made clear to the First Minister and the Health Minister. However, I emphasise that the decision will be made by the commission rather than the Assembly.

Nigel Evans: The Secretary of State rightly says that the matter is subject to public consultation. As we heard, more than 70,000 people have signed the petition organised by the South Wales Evening Post. The unit is important not just for Swansea, but for the surrounding areas, including west Wales. We know that there is a good road network to Morriston hospital. It has a helipad, which Cardiff does not, and skilled staff whose commitment and dedication save lives. Will the right hon. Gentleman discuss the provision of that facility with the Health and Social Services Minister? Cardiff does excel in some specialities, as do other areas, but when paediatric neurological experts state that first-class care is needed within a two-hour period, the facility cannot be allowed to move on health grounds alone because the consequences will be grave.

Paul Murphy: Of course I give an undertaking to talk about the issue with the First Minister and the Health Minister in Cardiff. The hon. Gentleman understands, as a native of Swansea, how important it is that medical services are of highest standards in west Wales. He can rest assured that I will take up the matter.

Alan Williams: Will my right hon. Friend make it clear to the health service commission that many of us in the House regard its approach as hypocritical? It holds it against Swansea that it does not have intensive care beds, but it refused to allow the hospital to have those beds despite a recommendation by the Welsh Office in 1998.

Paul Murphy: The fact that my right hon. Friend has added his voice to the campaign is significant. He, too, can rest assured that I will raise his specific point with the Health Minister.

Regional Airports

Ian Liddell-Grainger: What discussions he has had with the First Secretary of the National Assembly regarding assistance for regional airports.

Paul Murphy: I have regular discussions with the First Minister about matters affecting Wales, including a wide range of transport issues.
	I was delighted to hear the recent announcement that BMI is to use Cardiff International airport as a base for flights to the European mainland. That is a tribute to the airport operators as well as to the Assembly and its partners in marketing Wales as an attractive place to do business.

Ian Liddell-Grainger: Many people from Somerset use the airports at Bristol and at Cardiff, where BMI is now an operator, to go abroad, and one problem with getting to both those regional airports is the road system. Given that the regional consultation document will come out later this year, will the Minister do what he can, when the consultation is over, to make sure that people who want to use the airports, in an area that is not well known for easy access, will have the chance to do so?

Paul Murphy: Obviously, I will do what I can. In the job that I hold I cannot promise that I can do much for Bristol, but I can probably do a little more for Cardiff. I take the hon. Gentleman's point that in south-west England, which includes his constituency, and south Wales there is a need for the road and rail system to integrate with the air transport system. He made valid points, and I shall certainly make sure that I raise them when I discuss the matter with the First Minister.

John Smith: I agree with my right hon. Friend that the best way to boost regional airports is to attract low-cost airlines, such as bmibaby, which we have just secured as an operator at Cardiff International airport. That will mean an increase of up to 1 million passengers a year coming through Cardiff, but it could also mean 500,000 traffic movements on the road to the airport, so it will present challenges concerning access. Will my right hon. Friend look into that matter?

Paul Murphy: The point made by the hon. Member for Bridgwater (Mr. Liddell-Grainger) is exactly the one made by my hon. Friend. I agree with him about the numbers. He will know that about 1.5 million passengers a year use Cardiff International airport, and with BMI coming on board that figure will rise to 2.5 million. That is good news for Wales and for my hon. Friend's constituency.

Lembit �pik: The experiences of the south of Ireland have shown that the economic development of regional airports directly stimulates economic development around them, and that has been very beneficial. Is the Secretary of State aware that Welshpool and other regional airports in Wales have strategic plans to, for example, extend runways and terminal facilities? Is he willing to lend Wales Office support to the inevitable consultation with the Civil Aviation Authority as those airports seek to extend their operations?

Paul Murphy: I very much take the hon. Gentleman's point about regional airports as well as the other airports in Wales that I have mentioned, and I have been to Welshpool airport. The Under-Secretary of State for Wales, my hon. Friend the Member for Islwyn (Mr. Touhig), and the Under-Secretary of State for Transport, my hon. Friend the Member for Plymouth, Devonport (Mr. Jamieson), who deals with these matters, have been in discussion about the regional air services study, which will come out shortly. It will examine the need for road and rail links to airports in Wales, as well as their potential for economic growth. They are indeed magnets for such growth, and the hon. Gentleman can be assured that we will take up those matters.

Chris Ruane: Will my right hon. Friend use his position to ask the management of BAe in Broughton in north-east Wales if it will open its runway to commercial private use for airlines in Wales? After all, BAe has received 250 million of public funds to help it to develop the airbus, and the least that it could do is open the runway.

Paul Murphy: I will be in north Wales in a few weeks, and I shall certainly make sure that I raise the issue. It is important because although many people in north Wales use Manchester airport, a regional airport in north-east Wales would be a great advantage to my hon. Friend's constituency.

Nigel Evans: Will the Secretary of State congratulate Air Wales on its new routes from Cardiff to Edinburgh and Glasgow, which are a great boost to Cardiff in the light of British Airways's reduction and withdrawal of services from the airport? In recognising the importance of regional airports such as Swansea and Cardiff, will he set up and chair a working party including, for example, the Welsh Development Agency and local authority chief executives and development officers, who can drive forward and assist regional airports in Wales so that the whole of Wales, especially the outer-lying areas, can fully benefit from the extra business opportunities that this will bring?

Paul Murphy: I know that the hon. Gentleman has taken a special interest in the airport at Swansea, and he is right to point out that Cardiff has new services to Glasgow and Edinburgh. I am aware of the aspirations to have a service from Swansea to Scotland, which would be good news for west Wales and indeed for Wales in general. As to the hon. Gentleman's suggestion that I chair a working party, it would be a good idea for him and other hon. Members who are interested in these issues to meet me to discuss the way forward.

Policing (Cross-border Co-operation)

Stephen O'Brien: If he will make a statement on the effectiveness of cross-border co-operation between Welsh and English police forces.

Don Touhig: There is good co-operation between the Welsh and English police forces aimed at combating organised crime. The national services, including the National Crime Squad and the National Criminal Intelligence Service, also provide valuable links across all police forces.

Stephen O'Brien: Given the 13 per cent. rise in overall recorded crime in north Wales, especially the 19 per cent. rise in robbery, it will come as no surprise to the Minister that I have been told by the Cheshire constabulary that many of the criminals committing robberies in my constituency come over the border from north Wales. May I urge him to ensure that maximum co-operation is permitted and encouraged between police forces, and that no political and administrative boundaries or differences in accountability can possibly get in the way of that full co-operation?

Don Touhig: I certainly take on board the hon. Gentleman's point. Cross-border co-operation is important if we are to reduce crime. He mentions the crime figures for north Wales. I can tell him that overall crime has fallen by 22 per cent. since the Government came into office, which compares with the doubling in crime that occurred during the 18 years when his party was in government.

Jon Owen Jones: Can my hon. Friend assure us that there is full co-operation between the police forces of south Wales and of Bristol to stem the dreadful epidemic of cocaine, especially crack cocaine? It already has too strong a hold on Bristol and its dealers are now looking to expand their market into south Wales.

Don Touhig: On 5 July, my right hon. Friend the Secretary of State met representatives of the three south Wales police forces in response to increased criminal activity, particularly in relation to drugs coming into Wales. The police forces have created a joint specialised drugs unit and are diverting resources into combating drug misuse. They are also working closely with their colleagues on the other side of the River Severn. To a certain extent, the supply of drugs in Wales is based on geographical factors. Supplies to the south come largely from drug dealers in Bristol and the west midlands, while those to the north come from Manchester and Liverpool. Cross-border co-operation is vital if we are to rid ourselves of that misery.

Paul Keetch: Many people who live in the Welsh marches live in very isolated communities, such as south Herefordshire, and when they dial 999 they want an immediate response, regardless of the badge on the emergency vehicle that comes. Given that fire brigades regularly cross borders to attend fires, should not police cars also do so, so that the closest patrol car responds to an incident?

Don Touhig: I understand the point that the hon. Gentleman makes. It is a difficult issue in some of the marches areas. I undertake to pass his point on to my right hon. Friend the Home Secretary.

Crime Reduction

Mark Tami: What recent discussions he has had with ministerial colleagues on measures to reduce crime in urban areas.

Don Touhig: My right hon. Friend and I have regular discussions with ministerial colleagues about a number of issues affecting Wales, including measures aimed at reducing crime.

Mark Tami: I thank the Minister for that answer. Antisocial behaviour is a crime that blights many of our towns and cities in Wales. I recently met community leaders in Connahs Quay, where such activities are increasing. Does my hon. Friend agree that the appropriate authorities need to be far more rigorous in their use of antisocial behaviour orders if we are to counter that threat?

Don Touhig: I understand my hon. Friend's concern. Indeed, I believe that he recently hosted a conference in Connahs Quay to discuss issues arising from crime levels there. Several initiatives are being considered by members of the Flintshire crime reduction partnership to tackle underage drinking, including the introduction of proof-of-age cards. I agree with my hon. Friend that the use of antisocial behaviour orders could be greater. In my part of south-east Wales they have been used to some extent with some effect. I hope that police services and local authorities that can make an impact on such behaviour will use them much more than they have in the past.

Julian Lewis: I want to focus the Minister's attention on a specific recent urban crime: the defiling of the synagogue at Ffynone in my home city of Swansea. Does the Minister know that the previous synagogue was destroyed by the Nazis during the second world war? Is not it ironic that Nazis should be trying to destroy the current synagogue? Will he accept, through his office, the thanks of the Swansea Jewish community, including members of my family, who have lived there for more than 100 years, for the warmth and hospitality that the people of Swansea have traditionally shown to their Jewish residents?

Don Touhig: I can think of nothing more offensive than desecrating a place of worship. Like all decent Welsh men and women, I was outraged by the attack on the synagogue in Swansea. The Jewish community in Swansea has always played a vibrant and important part in the life of the city, as the hon. Member for Ribble Valley (Mr. Evans) knows. We must condemn such actions; we should be ashamed of them in this day and age.

Chris Bryant: My hon. Friend knows about the drugs problem in valleys communities in south Wales. Local police reckon that 90 to 95 per cent. of local crime relates to drugs. Has he had an opportunity to decide when the all-Wales drugs conference, for which hon. Members and Assembly Members have called, will take place?

Don Touhig: That matter was raised by chief constables when they met my right hon. Friend the Secretary of State recently. I have also discussed it with colleagues, including Edwina Hart, the Assembly Minister responsible for anti-drugs policy, this morning. We take the view that such a conference should produce positive outcomes, and it should therefore have clearly defined objectives. My right hon. Friend the Secretary of State will raise the issue when he next meets the First Minister.

Elfyn Llwyd: Given the undoubted benefits of closed-circuit television, will the Minister make representations for the next phase in next year's Budget allocation? Phase 1 was 3 million; phase 2 was half of that. That meant that only 13 out of 300 applications were granted in Wales. Will he make representations for an adequate budget, given the usefulness of CCTV in tackling crime?

Don Touhig: I share the hon. Gentleman's view about CCTV's contribution to reducing crime and antisocial behaviour, and I take his point on board. The Government have extensively supported initiatives and contributed a great deal of money so that we can have CCTV projects throughout Wales and the United Kingdom. I take the hon. Gentleman's point seriously, and I shall ensure that my right hon. Friend the Home Secretary is made aware of it.

Nigel Evans: I, too, condemn the mindless and racist attack on the Swansea synagogue, which I shall visit on Friday.
	The latest crime figures show a 16 per cent. increase in robberies in Wales, with Gwynedd experiencing a staggering 440 per cent. increase and Bridgend a 105 per cent. increase. Detection has fallen from 41 per cent. to 39 per cent. Part of the reason for that is the fall in the numbers of police and special constables who patrol in Wales, and the increase in form filling that the police have to undertake. The Prime Minister stated that street crime, which has shot up, will be brought under control by September. Does the Minister stick by that commitment for Wales? If so, what will change to achieve that?

Don Touhig: The Government have laid the foundations for the most co-ordinated attack on crime in a generation. Billions of pounds have been invested in fighting crime; there are 4,500 more policemen on the beat in England and Wales now than two years ago. There are 523 more policemen on the beat in Wales than there were when the Conservative party was last in government. Only investment and reform will tackle the menace of crime. The Tories do not understand that, which is why they have not supported our investment or reform. No wonder the Tories have no Members of Parliament in Wales; they are not credible as a political party.

NHS Dentists

Ann Clwyd: What recent discussions he has had with the National Assembly for Wales about increasing access to NHS dentists in Wales.

Paul Murphy: I have regular meetings with the First Minister and the Health and Social Services Minister to discuss the NHS and other health matters.
	The Assembly aims to increase availability of NHS dental service provision in those parts of Wales where it is most needed, and in Wales overall, through the Welsh dental initiative scheme.

Ann Clwyd: As my right hon. Friend knows, there are fewer NHS dentists per head of the population in Wales than in any other country in the United Kingdom. Despite the Assembly's best efforts, access to NHS dentists and registering with an NHS dentist remain extremely difficult. That is directly linked to dental fees. The Conservative party was responsible for the growth of privatisation

Mr. Speaker: Order. The Minister is not responsible for the Conservative party.

Paul Murphy: I am grateful to my hon. Friend for her question, and she is of course rightwhether she is responsible for the Conservative party or not, Mr. Speakerabout the reasons why the NHS dental system in Wales has been so poor. It will take a great deal of time and money to put it right. I know that she is aware that the enormously successful financial settlement that has gone to Wales from my right hon. Friend the Chancellor of the Exchequer means that at last proper resources are going into the health service as well as the dental service in Wales.
	I should also tell my hon. Friend that there are 42 new dental practices, 41 expanded practices, 15 new posts in community dental services, and five mobile units at each health authority that deals with these matters. She is of course right about fees, and I shall ensure that the First Minister and the Health and Social Services Minister are made aware of the points that she has made.

Simon Thomas: Owing to the unfortunate death of a dentist in Aberystwyth, the imminent retirement of a dentist in Lampeter, and the possible criminal conviction of a dentist in Cardigan, thousands of my constituents have been told to travel to Brecon, Ammanford, Milford Haven and areas outside Wales for such servicesa two-day journey by public transport for pensioners in my constituency. Will the Secretary of State consider reforming NHS dental fees and talk with the Welsh Assembly about introducing salaried NHS dentists?

Paul Murphy: Of course I shall ensure that those points are made to the appropriate Ministers in the National Assembly. The hon. Gentleman knows that about a decade ago there was a 7 per cent. cut in NHS dentists' fees, and they have not got over that. What is certain is that something like 71 million is now spent on dental services in Wales. I hope that some of that money goes to rural areas, because that is particularly where difficulties lie. I know that in his constituency only 23 dentists deal with the national health service. That is a problem, but I know it is one that the Assembly is tackling.

Llew Smith: Does the Minister recall the statement made by the Welsh Assembly regarding the reorganisation of the NHS in Walesmade by the people who will be responsible for deciding many of the health issues that we have discussed today? Does he recall the Assembly giving a commitment that that reorganisation would be cost-neutral? Now we are told that it will cost 15.5 million. Does he believe that the people responsible for making that commitment should be subject to a compulsory numeracy hour, or was it another cheap public relations stunt by the Assembly?

Paul Murphy: I understand my hon. Friend's pointof course I dobut I know that he understands that, although 10 million to 15 million will be involved in changing the system, in the first instance that will result in more locally provided services. Much more important than all that, however, is the fact that, between now and five years' time, nearly 2 billion extra will go to the health service in Wales because of the spending review of my right hon. Friend the Chancellor of the Exchequer. It is only the resources going into those services in Wales that will provide the insurance for our future.

Welsh Lamb

Michael Fabricant: If he will meet the First Secretary to discuss the sale and promotion of Welsh lamb in England.

Don Touhig: My right hon. Friend the Secretary of State has frequent discussions with the First Minister, and I regularly meet the Assembly Rural Affairs Minister. A wide range of issues related to agriculture are discussed, including the sale and promotion of Welsh meat beyond Wales. Next week, I am due to attend the Welsh lamb presentation at the Royal Welsh agricultural show. I invite the hon. Gentleman to join me there to promote Welsh lamb.

Michael Fabricant: The Minister makes a tempting offer; I might do just that if I can borrow his ministerial car. I invite him to visit David Trant in Welshpool. He belongs to the Waitrose Welsh assured lamb scheme, which promotes Welsh lamb. Will the Minister join me in congratulating department stores and supermarkets such as Waitrose and others which promote Welsh lamb? I invite him to read the John Lewis Partnership gazette of 1 June, which outlines the plan in considerable detail.

Don Touhig: I shall commend the hon. Gentleman for a job with the Welsh Tourist Board; he does a very good job, and I know that he is also a Welsh learner. Congratulations! I also congratulate the gentleman whom he mentioned. It is important that we should take every opportunity to promote the good produce that we have in Wales. Only last week, we had a very successful food fair in Cardiff, and there are about 40 events between now and October to promote Welsh food, including Welsh lamb. I recommend that the hon. Gentleman and other hon. Members visit Wales, where they will receive a warm welcome and taste some wonderful food.

PRIME MINISTER

The Prime Minister was asked

Engagements

Bob Laxton: If he will list his official engagements for Wednesday 17 July.

Tony Blair: This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further such meetings later today.

Bob Laxton: Following the Chancellor's announcement on Monday of the huge investment in public services, which has been warmly welcomed throughout the countrythe only lack of warmth coming, I suspect, from the Conservativesmay I tell my right hon. Friend how much I welcome the ongoing funding of 2 million for the new deal for communities, along with the increase in resources for the neighbourhood renewal fund? That will have a strong impact on local communities. May I ask the Prime Minister whether he would like to visit the Derwent new deal project in my constituency, and see the real partnership between local authorities that operates there? Does he agree with me[Interruption.]

Mr. Speaker: Order. That is enough for the Prime Minister.

Tony Blair: I think I got the point, Mr. Speaker. Of course, it is not just about the money that is coming to the constituency of my hon. Friend and of other hon. Members; it is also about what the money that has gone in through the new deal has already delivered. To those who say that the extra investment delivers nothing, I would point to long-term youth unemployment in my hon. Friend's constituency being down by 75 per cent. through the new deal, to the best primary school results that we have ever had, and to in-patient and out-patient waiting lists being down. That is a result of the investment, which is why it is so right to put it in, and such folly to take it out. Talking of which

Iain Duncan Smith: It is what money is actually spent on that counts more than how much money is spent.
	[Interruption.] I am surprised that Labour Members get so upset about that, because those were the words of the Prime Minister in 1997. So, while we are on the effect of what he is actually spending and whether it is delivering, will he tell us how much recorded street crime has risen over the last 12 months?

Tony Blair: Recorded street crime has indeed risen over the last 12 months. I do not know the precise figure, but it has risen. However, it is as a result of that that we are taking the necessary measures, including investing in our police and increasing the number of police on the beat. Even for street crime, it would be folly to take that investment in the police out.

Iain Duncan Smith: The Prime Minister for ever says that he will be judged on exactly how effective the measures are that he is taking, but street crime has actually increased by more than 30 per cent. over the last year, and doubled in the last three years. So, presumably, by his own measure, he must now be failing. In the spending review of 2000, the Home Office promised to cut recorded robberies by 14 per cent. Will the Prime Minister tell us whether the Government are now on track to achieve that as well?

Tony Blair: What I can tell the right hon. Gentleman is that, as a result of the additional measures that we are taking on street crime, we will indeedas I have said beforeget street crime under control by the end of September, as we said we would. I think that he will see from the initiatives being taken, particularly the safer streets initiative in London, that we will do that. Of course, overall, crime under this Government has fallen, not risen, whereas it doubled in the 18 years of Conservative government. However, if he is serious in his commitment to the fight against crime, there is the Proceeds of Crime Bill that is now before the other House. According to the police, that measure is essential to deal with drug dealers and others who can secret their assets. I ask him now to reverse the position of the Conservative party and to support what is an essential measure in the fight against crime.

Iain Duncan Smith: The Prime Minister never lets the facts get in the way of a good bit of spin. He knows that we supported that legislation, and that we voted in favour of the confiscation of assets from criminals, particularly drug dealers. So instead of pretending the other case at the Dispatch Box, would he like to apologise and say that he was wrong?
	The Prime Minister was asked a direct question. The answer to the question of whether the number of recorded robberies has risen is that it has increased by more than a quarter in the past year, so he is failing on that measure as well. He then referred to the pledge that he says he made in September. I have checked through the public service agreements and the comprehensive spending review, and I cannot find a single reference to the pledge that the Prime Minister made in April to reduce street crime to below its April levels by the end of September. Will he make that pledge again today?

Tony Blair: I have just made it a moment ago, in the answer that I gave. [Interruption.] I did: I said that, as I indicated before, by the end of September we must have street crime under control. That is precisely why we are taking the initiatives that are necessary. That is why, for example, we are tightening up on bail, making sure that more police are on the streets and that magistrates courts work more effectively, and getting cases to court quicker. Let him now deal with this point. Each and every one of those initiativesmore police, better working of magistrates courts, better working of the criminal justice systemrequires extra investment. Let the right hon. Gentleman come to the Dispatch Box and commit himself to supporting that investment.

Iain Duncan Smith: The level of public spending is no longer the best measure of the effectiveness of government.
	That is what the Prime Minister said in 1997, so every time his figures go wrong, there is failure on the streets, and violent crime and robberies rise, it is no good his saying, We're just going to spend a bit more money and it's all going to be all right. That is his problem.
	Back in April, the Prime Minister said not just that street crime would be under control; in an interview with Mr. Paxman on Newsnight, he said that he would reduce the levels of street crime to below the April level. Instead of fiddling figures that he does not even include in his publications, will he now pledge to do just that?

Tony Blair: I shall certainly repeat exactly what I said to Mr. Paxman. What is more, I agree that street crime has gone upI admitted that in my first answer to the question. However, I then described what we were doing to get it back down again, and exactly those measuresparticularly the extra money that we are putting into the policeare essential to that. Whether it is the police, education, health or transport, how on earth can it be that we make the problems in our public services better by cutting the vital investment that they depend on?

Michael Clapham: My right hon. Friend will recall that, following the Fairchild decisionand while we were awaiting the House of Lords judgmentmy right hon. Friend the Secretary of State for Transport, Local Government and the Regions initiated the pneumoconiosis compensation scheme to allow payments to be made to mesothelioma sufferers who had made claims against the company. Will he consider reopening or extending the pneumoconiosis compensation scheme to cover claimants who have made claims against Turner and Newall because the parent company, Federal Mogul, has gone to court in America to file for administration and it could be several years before the case is resolved? Will my right hon. Friend therefore consider advising that the scheme be extended to cover those claims?

Tony Blair: I think that my hon. Friend knows that we are considering representations that he and others have made. I know that he and other hon. Members have met the company's administrators and a meeting with representatives of the Department of Trade and Industry and others has been arranged. The Government have also been in discussion with the administrators, and understand that they are actively looking at ways in which urgent claims can be dealt with prior to the conclusion of the administration of Turner and Newall.
	The best that I can tell my hon. Friend at this moment in time is that we are listening carefully to what he says. He knows about the technical and legal problems involved in extending coverage of the scheme, but we are taking an active interest in negotiations, and I hope that they can be brought to a successful conclusion.

Charles Kennedy: The United States Administration are taking the view that further military action against Iraq would not require new United Nations security resolutions. Does the Prime Minister agree?

Tony Blair: We must certainly take any action in accordance with international law, but as the Foreign Secretary made clear when he spoke about this is the House a few months ago, that does not necessarily mean that there will be a new United Nations resolution. However, we will make sure that whatever we doas I say constantly, no decisions have yet been takenshould be in accordance with international law.

Charles Kennedy: Turning to the role of the House, if in due course further military action is considered appropriate against Iraq and if British forces were involved, would that be subject both to the debate that the Prime Minister has pledged and to an affirmative supportive vote in the House of Commons?

Tony Blair: As I said when I appeared before the Liaison Committee yesterday, at present we have no proposals to put before the House, but we will obviously consider how best to consult the House properly should any such action arise. However, I emphasise to the right hon. Gentleman and others that no decisions have yet been taken. I emphasise, too, that we have to deal with the issue of weapons of mass destruction and Iraqit will not go away. There are many different ways of dealing with it, but we do have to deal with it.

Frank Cook: The Prime Minister will know that conditions such as leprosy and polio are generally treatable in a day clinic. The incidence of those diseases in south-east Asia, especially Laos, is increasing at an alarming rate due to the lack of power for vaccine fridges and medicine chests. Will my right hon. Friend use his considerable influence in international organisations to support a programme of supplying power from small-scale renewable energy to tackle that problem in certain locations?

Tony Blair: I entirely understand and share my hon. Friend's concern about the issue, which, as he rightly points out, is a significant one in Asia. The global health fund of about $1.8 billion is available for use not just in Africa but elsewhere. I shall certainly look into the point that my hon. Friend made in the concluding part of his question.

Julian Brazier: In reply to my right hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith), the Prime Minister admitted that robberies have increased substantiallythey have actually gone up by about a quarter. He said that by September they would be under control. Could he tell the House by how much he expects robberies to have fallen by September?

Tony Blair: Yes: instead of the trend being up, it should be down, with numbers coming down.

Parmjit Dhanda: The Prime Minister will be aware of the success of URCsurban regeneration companieswhich have been set up in towns and cities throughout the land and are helping to encourage regeneration. Will he join me in calling for a URC to be set up in my constituency of Gloucester, where we are trying to push through 0.5 billion of regeneration and where a URC could make all the difference?

Tony Blair: URCs have certainly been very successful, but I think I should take some advice before giving my hon. Friend the commitment that he seeks.

Elfyn Llwyd: A fortnight ago, the Prime Minister rightly told the House that one of the biggest challenges facing the G8 countries was conflict resolution in Africa. Is it not unfortunate that his Government continue to sell arms to African states? In particular, does he regret the fact that his Government sanctioned the sale of arms to all five combatants in the Congo?

Tony Blair: We actually have very strict rules on the sale of weapons to conflict areas, but I take exception to the first part of the hon. Gentleman's question. I think it important for this to be said clearly, and to be clearly on the record. The arms industry and related industries in this country employ about 100,000 people. There is nothing wrong with that industry's being successful and making sales to overseas Governments. What we must do, however, is ensure that they are not involved in the type of serious conflict that is happening in parts of Africa. That is precisely why we have such strict rules governing the export of arms. But if we were to do what the hon. Gentleman and his colleagues want and halt all arms sales by British companies around the world, that would have a devastating effect on many people's jobs.

Anthony D Wright: I am sure that my right hon. Friend and all other Members will want to join me in expressing sadness at yesterday evening's tragic helicopter crash off Great Yarmouth. Our thoughts are certainly with the families and friends of those involved. The oil and gas industry today is a much safer environment in which to work, but tragedies of this kind always bring home to us the danger faced by the many hundreds of thousands of men and women who try to bring our gas and oil reserves ashore.
	Will my right hon. Friend pay tribute to the emergency services, which responded immediately, and to the rig and ship workers, which did so as well? Will he also ensure that during the investigation no stone is left unturned to find the reason for the crash?

Tony Blair: First, I am sure that the whole House would want to express deep sympathy and condolences to the families of those who died in the helicopter crash. Secondly, I pay fulsome tribute to the emergency services, which respondedas they always doin magnificent fashion. Thirdly, I know that an air accident investigation branch is looking carefully into the reasons for the accident. At present, obviously, we cannot speculate on the cause, but I assure my hon. Friend that we will leave no stone unturned.

Mark Prisk: The number of recorded robberies in Hertfordshire has risen by 34 per cent.by a thirdin just one year. If the Prime Minister will not try to give a straight answer to my parliamentary colleagues, will he at least give a straight answer in response to the fears of my constituents? Will he tell them why crime is rising for them?

Tony Blair: I can do that. First, let us be quite clear: crime overall has fallen, not risen. It is true that there is a particular problem with street crime and violent crime, which is precisely why we have been working on it for the past few months. We have been hiring more police officers, which is important. We have been ensuring that we tighten the conditions relating to bail. We have also been ensuring that we make extra investment in such things as CCTVand, of course, there is the Proceeds of Crime Bill. The only unfortunate thing is that the Conservative party opposes each of the measures we take.

Andy Burnham: According to the chief medical officer, death rates in some communities in the north-west and north-east have not improved since the 1950s. Does the Prime Minister agree that that shocking statistic results from underfunding over decades, not just of the health service but of all our public services? Will he also assure me that the new formula now being developed for the sharing out of the welcome new resources will take full account of health needs in communities such as Leigh?

Tony Blair: The review of the formula used in the allocation of resources in the national health service will indeed take account of the need to reduce health inequalities. My hon. Friend's constituency has obviously accumulated severe problems over a long period. That is precisely why it is important for investment in the health service not to be taken out, but to be kept going year upon year upon year. As my hon. Friend knows, by 200708 health spending in this country will be above the EU average. It is important for us to ensure that the investment continues, because it is the only way in which to make a defined and sustainable difference to people's health.

Iain Duncan Smith: Last month, the Prime Minister told the House that the stock market was massively up since the pensions tax was imposed in 1997. Will he tell the House how massively up it is now?

Tony Blair: It will not have escaped the right hon. Gentleman's notice, nor anyone else's, that our stock market has fallen, as has every stock market around the world, including in America and Europe. The idea that that fall is unique to Britain is an indication only of the total opportunism of the Conservative party.

Iain Duncan Smith: Early on, when he was first elected, the Prime Minister loved to take responsibility for a rising stock market. Strangely enough, it is now somebody else's faultas ever. I notice that the Prime Minister has not turned to the Chancellor for advice this time, but perhaps he ought to. Since that period in 1997, stock markets in Europe and the US have risen by 8 per cent., whereas ours is now down by 15 per cent.
	Not only did the Prime Minister get the matter wrong, he also said at the time that the pensions tax was justified because of
	the buoyancy of the stock market.-[Official Report, 7 March 2001; Vol. 364, c. 285.]
	Does he believe that the pensions tax is still justified by the buoyancy of the stock market?

Tony Blair: I do believe that it is justified. What is more, when I read the debate on the subject the other day, I noted that the spokesman for the Conservative party was asked whether he would reverse the measure. He said that he would not, which renders the right hon. Gentleman's question slightly absurd. The idea that the stock market has fallen because of something to do with the British economy is incorrect, as stock markets all around Europe and America have fallen.
	However, there are differences between the state of the UK economy now and a few years ago: we now have the lowest interest rates for about 30 years, the lowest unemployment for 25 years, and the lowest inflation rate in Europe. Another difference is the absence of that old Tory theme of boom and bustand thank goodness for that.

Eddie McGrady: Is my right hon. Friend the Prime Minister aware that there was a rocket attack in my constituency early this morning in an attempt to kill two officers of the Police Service of Northern Ireland? I am sure that he and the whole House will join me in condemning such a cowardly and dastardly attack, and in wishing those two officers a speedy recovery. Thankfully, they were not seriously injured.
	Does my right hon. Friend agree that this morning's attack was an attack on the peace process in Northern Ireland? In this very difficult week, will he guarantee to use his best endeavours to ensure that all parties to the peace process make the necessary sacrifices to sustain peace and our democratic institutions?

Tony Blair: My sympathy goes to the officers involved, of course, and I join my hon. Friend in wishing them a speedy recovery. He is entirely right: the attack's purpose was to undermine the peace process. There is no doubt that, as the process moves forwardwhatever the difficulties involvedthe people who want to return to the sectarianism and brutality of the past want to try to disrupt it. The Police Service of Northern Ireland, for all the difficulties, marks a new approach to policing in Northern Ireland. I hope that, in time, it will be supported by all the main political parties there. When people attack officers of that police force, they are attacking the agreement itself. They are also attacking a future for Northern Ireland that is based on mutual respect and prosperity. I assure my hon. Friend that we will do everything that we can to sustain the peace process, as it is right for the people of Northern Ireland and the United Kingdom.

Nigel Waterson: Does the Prime Minister recall telling the House on 15 October 1996 that the shortage of beds in the NHS was a disgrace? What word from his extensive repertoire would he now use to describe the fact that 131 beds in my local hospitals are currently affected by bed blocking?

Tony Blair: Obviously, I am not familiar with the details of the hon. Gentleman's constituency. However, in the past year, there has been an increase in the number of NHS beds. Overall, the national figures show that bed blocking has fallen since 1997, and that is because last winter we put additional investment into the NHS. Whatever the problems in the hon. Gentleman's constituencywhether they are to do with the number of beds, nurses and doctors, or with local primary carethe answer, surely, is not to cut the investment going into his health care service. I suggest that he joins us in addressing those problems with the investment and reform programme and, in particular, supports the measures that the Chancellor announced on Monday. That might be a good idea not only for his constituents but for him.

Helen Jones: There are parts of my constituency where people cannot sit in their own home in peace because of crime and antisocial behaviour, which is fuelled by the illegal sale of alcohol to young people. What will the Prime Minister do to clamp down on the irresponsible retailers who sell alcohol to children who are clearly underage? Will he put pressure on the drinks industry to end the iniquitous practice of marketing alcoholic drinks that are clearly aimed at young people?

Tony Blair: We are toughening the penalties on the sale of alcohol to young people. My hon. Friend is absolutely right to draw attention to the problems of antisocial behaviour. That is one of the reasons that we introduced measures such as antisocial behaviour orders. It is unfortunate that the Conservative party is still apparently opposed to them. My hon. Friend will know that one of the things that is most important in dealing with antisocial behaviour is having extra numbers of police on the street, and the Conservative party is opposed to that as well.

Sydney Chapman: The Prime Minister will know that the take-up of the MMR vaccination in London has now reached a record low, as instanced in my borough by the fact that only 70 per cent. of parents have given their children the jab. Is he aware that the number of cases of measles in our capital city has quadrupled over the past year? As those two events are not unconnected, will he take this opportunity of publicly dissociating himself from the remarks of the Mayor of London, who is advising London parents not to give their children the jab?

Tony Blair: First, I do not agree with what was said by the Mayor and I am sure that the hon. Gentleman does not agree with some of what has been said by his hon. Friends. It should be made very clear that there is not a shred of evidence anywhere that the MMR jab is anything other than the right course to take. It is employed in 90 countries around the worldin America, in Europe and everywhereand it is essential that we retain it, and retain it in its present form, since that is the best way to get the coverage to deal with these diseases. I take that view very strongly; I am glad that the hon. Gentleman does too and perhaps, jointly, we can make those views clear to everyone.

Tony Lloyd: The Prime Minister will be aware that my constituency has seen a rising number of gunshot incidents, some of which have led to the murder of mainly young men. He is right to say that we need more police on the streets. However, will he join me in applauding the actions of Mothers Against Violence? Women whose children have been shot and killed have taken the very brave step of publicly standing up to condemn the violence in their communities; they are trying to change the culture where young men are prepared to use firearms. When my right hon. Friend is next in the city of Manchester, will he agree to meet that group of women to give them his support and that of the Government?

Tony Blair: I would certainly be happy to do that. I congratulate Mothers Against Violence in Manchester on the work that they are doing. I hope, too, that they will see from the announcement that my right hon. Friend the Home Secretary will make shortly that it is necessary to strengthen the protection for victims and witnesses. One of the problems with this type of violent crime, and gun crime in particular, is people's reluctance to come forward and give evidence. It is precisely for that reason that my right hon. Friend the Home Secretary will shortly be announcing measures to strengthen our criminal justice system.

Andrew Rosindell: Could the Prime Minister tell us whether there are any circumstances in which he would consider sharing sovereignty over his own constituents in Sedgefield? If, as I suspect, the answer is no, why does he seek to do so over the people of Gibraltar, whose only crime is loyalty to the United Kingdom?

Tony Blair: As usual, that is a typical piece of opportunism by the Conservative party. The process began[Interruption.] The Brussels process was launched by the Conservative Government in 1984. The last time I was answering such a question, I did not have before me the full text of the 1984 communiqu, but I do now. This is what was signed up to by Mrs. Thatcher and the last Conservative Government:
	Both sides accept that the issues of sovereignty will be discussed in that process.

Several hon. Members: rose

Mr. Speaker: Order. There will now be a statement by the Home Secretary. [Interruption.] Order. Will hon. Members leave the Chamber quietly?

Criminal Justice White Paper

David Blunkett: For the third week running, Mr. Speaker, if it is Sheffield it is Wednesday and if it is Wednesday it is Sheffield. With permission, sir, I wish to make a statement on the reform of the criminal justice system in England and Wales.
	Today, we are publishing a White Paper outlining an end-to-end reform of the service.
	First, however, may I pay tribute to all those who have assisted in this tripartite paper, including the Lord Chancellor and the Attorney-General, and thank in particular Sir Robin Auld for his review of the criminal courts, and John Halliday for his sentencing review.
	The people of this country deserve a criminal justice service that works in the interests of justice and puts the victim first. The White Paper is designed to rebalance the criminal justice system in favour of the victim and the delivery of justice for all. We are sending the strongest possible message to those who commit crime that action will be effective in detecting, convicting and properly punishing the perpetrator.
	We have a tradition of justice in this country going back centuries. We have already embarked on reform of the police and an overhaul of youth justice, including a dramatic drop in the time it takes to bring young offenders to justice. The street crime initiative has already made a difference by bringing together the police, Crown Prosecution Service and the court administration.
	I can announce today, following the Chancellor's statement on Monday, that over the next three years we will invest more than 600 million in information technology. That will help us in joining up the criminal justice service.
	But root-and-branch reform across the board is still required. Delay, inefficiency and repeated adjournments are costing us dear. Through improved police investigation, case management and presentation, conviction of the guilty must be secured and acquittal of the innocent ensured. What we seek is not simply the process of justice but visible evidence that justice has been done.
	Every time someone on bail offends, or a case collapses, or the wrong verdict is revealed, we compound the harm done to victims and to society as a whole. We will ensure that both victims and witnesses are protected. We will provide them with separate facilities from the accused. To ensure that their voice is heard, we will establish a victims' commissioner supported by a new advisory panel. Above all, we will deliver faster, more effective justice.
	Our actions will be underpinned by the fundamental principle that a person is innocent until proven guilty and that the prosecution must prove its case beyond reasonable doubt. However, the one in eight defendants who fail to appear at court will be dealt with swiftly and summarily. We will bring in incentives for early guilty pleas, deal decisively with delays and improve the use and availability of forensic and technological expertise.
	As soon as practicable, the Crown Prosecution Service will take over responsibility for determining the charge in the most serious cases, except where the police need to make a holding charge. We will allow the police to impose conditions on bail before charge to limit the chances of offending.
	Disclosure of information is currently a battleground between defence and the prosecution. That leads to delay and to considerable cost. We will rebalance the rules of disclosure. Both prosecution and defence will be obliged to disclose all the material necessary. We will make the rules of evidence simpler and clearer. Relevant previous convictions will be admissible where the judge believes that that would be helpful to the jury, without prejudicing the defendant's right to a fair trial.
	In time, we will integrate the management of the courts into a single organisation. We will extend the sentencing power of magistrates from six months to 12, and legislate to allow Parliament to extend this to 18 months.
	I can tell the House today that the right of defendants to elect for jury trial will remain. However, in order to deliver justice in serious and complex fraud trials, we will seek Parliament's consent that such cases can be tried by a judge sitting alone. We will consult on whether a judge sitting alone should deal with trials where the danger of intimidation makes justice difficult to achieve. In addition, we will explore a similar option for complex financial or organised criminal cases.
	We have a real problem when, in some parts of the country, around three quarters of jury trials result in acquittal. The Government will produce in the months ahead a joint paper on long-term prevention for children at risk. We will legislate in the next Session to increase the powers of youth courts to hear more serious offences.
	Currently, no one can be tried more than once for the same offence. This is known as double jeopardy. We will allow for a retrial in cases where compelling new evidence such as DNA has come to light. This will cover murder and very serious offences such as rape.
	As I said last year, we must put the sense back into sentencing. For the first time, we will set out in legislation the purpose of sentencing: to protect the public, punish the perpetrator and prevent reoffending.
	We will establish a guidelines council to ensure greater consistency in sentencing and to ensure that Parliament has a role in considering and scrutinising draft guidelines.
	We will introduce a new suspended sentence of custody minus, which will provide automatic imprisonment for offenders who breach their sentence. We will reform short custodial sentences and introduce, once piloted, custody plus, requiring offenders to serve the whole of their sentence, partly in custody and the remainder under strict supervision.
	A new intermittent custodial sentence will mean that offenders spend part of the week in custody. Reparation and drug and alcohol treatment will help address offending behaviour. But in protecting the public, we are placing emphasis on dealing with dangerous violent and sexual offenders. Those not sentenced to life imprisonment but who are nevertheless a danger to society will remain in custody until they are considered safe for release. An indeterminate sentence will ensure that they will only be released under strict supervision when they are no longer assessed to be a threat to the public.
	The House takes seriously its duty to protect the public, and we wish to ensure that democratically elected representatives retain the right to protect those whom we serve. A whole-life tariff should mean life.
	The proposals that we have set out are far-reaching, radical and require a culture change. To achieve that, we will need to gain the support of those in the service and, of course, the wider public. We will also need a balanced and sensible debate, which, I hope, will be led by the House today. We need to reinforce trust and confidence in the criminal justice system as we seek to deliver justice for all our people.
	I commend the statement to the House.

Oliver Letwin: I thank the Home Secretary and his ministerial colleagues not only for their courtesy in providing, as usual, an early copy of the statement, but for briefing me on the White Paper itself.
	There have been 12 Criminal Justice Bills since the inception of the present Government. That is quite a large number of pieces of legislation, but the Home Secretary feels, and we entirely agree, that that legislation has not given us an effective criminal justice system. The system needs reform. That is common ground. As the Lord Chief Justice recently and rightly said, there is much need for the codification of offences, sentencing, procedures and the rules of evidence. That is recommended by Lord Justice Auld, requested by judges and magistrates throughout England and Wales and supported by all parties in the House. Let us by all means get down to the job.
	Let us find ways to enable the judiciary better to manage trials. Let us find ways to make the co-operation between the police and the Crown Prosecution Service more effective. The electronic exchange of case files between them, rather than paper in the post, would be a good start. Let us find ways to reduce the number of trials that crack late in the day, disillusioning witnesses and victims. Let us find ways to apply the lessons of the O'Dowd report to reduce the bureaucracy that massively impedes our front-line police officers.
	On all those aims and more, we are agreed. Some of those aims can be fulfilled only by legislation. We offer our full co-operation in framing that legislation. Other aims will require administrative action. We wish the Home Secretary well in taking that action, but there is in all this a danger. The result of the last 12 Criminal Justice Bill and the other steps taken by the Government in the past five years has not been a success; it has been a failure.
	The aim of the criminal justice system is to reduce crime. Crime in this country, and street crime in particular, remains at wholly unacceptable levels. No amount of statistical manipulation can mask the fact that we face a crisis of criminality in some of our inner cities. To tackle that crisis, we need better crime prevention. We need the police to be back in charge of our streets and neighbourhoods. We need to give serious attention to young people who are the casualties of dysfunctional families. We need thorough reform of the sentencing of persistent young offenders. And we need clear-minded effective measures to undermine the drug culture.
	The danger is that in the absence of coherent and effectively implemented strategies of that kind, the Government may be tempted instead to convey the impression of effective action by changing features and principles of our criminal justice system in a way that will, in the long run, undermine, rather than strengthen, public confidence in that system.
	The single most important phrase in the Auld report is the statement that justice is not a game. The purpose of a criminal trial is twofold: to convict the guilty and to acquit the innocent. Each of those is as important as the other. No one is more committed than the Conservative party to the detection, prosecution and conviction of the guilty, but we have in this country a precious inheritance in the widely held confidence that British justice is just, that British trials are fair and that the innocent will be acquitted.
	In seeking rightly to enhance the likelihood of convicting the guilty, we must be sure that we do not decrease the likelihood of acquitting the innocent. I imagine that those twin aims are, in fact, common ground between myself and the Home Secretary. The issue that we face is one not of aim, but of practical result.
	The Opposition will want to consider carefully the fine details of the proposals to adjust the rules on double jeopardy, on trial by jury and on the release of information about previous convictions to ensure that any such adjustments will both materially increase the chances of convicting the guilty and contain safeguards to protect the innocent. The presumption of innocence and the right to a fair trial are a precious part of our birthright. In designing a system, as we must, that more effectively convicts the criminal, we must not abandon that birthright.

David Blunkett: I appreciate the warm welcome that the right hon. Gentleman has given the White Paper this afternoon. We appear to disagree on only two things. The first is that crime rose by more than 100 per cent. while the Conservatives were in office, and it has fallen by more than 22 per cent. since we came into office. The second is that we need more money to achieve the process of case management and electronic interchange that the right hon. Gentleman mentioned. The 600 million that we are devoting to that would be cut by the Conservative party.
	On everything else, we appear to be in agreement. A large number of reforms have been introduced but they have not yet achieved everything that we need. We are agreed on that. Codification over time is a valuable objective. We need to ensure that we overcome failure at every point in the system to reduce crime further, which, of course, involves the 4,500 extra police officers brought in during the last two years, who again had to be paid for by investment from public funds. We are all agreed that where the system breaks down, there is a crisis of criminality, particularly for the most disadvantaged. That affects many of the people whom we represent. That is why we are announcing end-to-end radical action this afternoon.
	We also agree that the measures must have coherence, from detection and good policing all the way through to sensible correctional policies to avoid reoffending. That is precisely why we recognise another issue on which we may have a slight disagreement. We agree that the system must protect the innocent, and we also believe that it should more effectively convict the guilty. We must also recognise, however, that, whatever the view held in the past by the rest of the worldand by the population of Britainof our criminal justice system, it is no longer held in the high esteem in which all of us would wish to see it being held in the future. It is no longer held in high esteem because the credibility of the system has been undermined as witnesses have been deterred from coming forward; as those who have perpetrated crime do not even turn up to court; as 25 per cent. of those on bail reoffend; and as two out of five of under-18s reoffend.
	We are introducing this radical reform not simply because we have dreamt it up, but because Lord Justice Auld, the Law Commission, and the reports over the last decade have told us that radical reform is required. If the Conservatives and the Liberal Democrats are going to join us, I welcome that. I would also welcome further consultation with them to ensure that the system commands consensus and that it holds for decades to come, rather than being subject to change on change, which disrupts the system rather than putting it right. That is my offer to the Opposition this afternoon.

Simon Hughes: First, I welcome the Home Secretary's offer, which we accept unreservedly. On behalf of my colleagues, I welcome the breadth of the White Paper and much of the specific detail. I hope that the Home Secretary will see that there are only a small number of matters on which we start from a different position.
	We share with the Home Secretary the view that the victim must be much more at the centre of the whole criminal justice process, and that witnesses need much more support and protection. It is very welcome that the Government have returned to the position that the Labour party held before 1997, which many of us have held all alongthat in serious cases people on trial should always have the right to choose to be tried by their peers.
	However, if, like the Home Secretary, we are to be honest about the failures of the system, we must recognise the two biggest failures. They are not that a huge percentage of people plead not guilty when they get to courtmost plead guiltyor that a huge percentage of trials do not result in a guilty verdict, because most of them do. Instead, the first failure is the terrible figures that the right hon. Gentleman had to report last weekI do not blame him for them historicallythat only one in four of all crimes result in someone being arrested and proceeded against. In some areas of London, the figure is one in eight. Unless we improve the catching and clear-up rates, the rest of the system will have relatively very much less to do. Secondly, unless we allow witnesses to be so supported that they continue to give evidence and stay throughout a trial, we will never get many of the most serious cases to the point of conviction, which is where we all want them to be.
	We disagree on only three main matters. First, many of us are far from persuaded that it is possible to have a fair trial if, in the normal course of events, previous convictions are known to the court before the verdict. I hope that the Home Secretary will be prepared to reconsider that issue. Secondly, on double jeopardy although I understand his argument, the case for keeping the rule against double jeopardy even in the most serious cases is this: if we were to legislate retrospectively, as a result of the proposals passing into law, every person alive acquitted after a full trial for a very serious offence would have that definitive decision turned into a provisional verdict that would be always open to challenge.
	Thirdly, although it is of course right for Parliament to set a maximum sentence, including life imprisonment, I ask the Home Secretary to consider whether it is not always wrong for Parliament to set a mandatory sentence. Every case demands a specific and different consideration. Will he consider whether it is not always wrong for Ministers to decide the tariff at the end of a serious case? However much integrity they have, it is must be better that an independent judge makes that decision rather than someone who is seen as a party politician.

David Blunkett: I welcome the hon. Gentleman's tone and approach. We agree about putting victims at the centre, and about the critical aim of protecting, encouraging and supporting witnesses.
	We have a slight disagreement about the statistics on people pleading guilty. Some 57 per cent. of those who opted to go to Crown court instead of being heard in a magistrates court eventually pleaded guilty, so the decision was clearly a delaying tactic. There are very real issues here. [Interruption.] To plead guilty after months of prevarication[Interruption.] The barracking can continue from the barrack-room lawyers, but it is simple fact that 57 per cent.[Interruption.] Real lawyers represent real people, just as we represent the victims of crime and not those who earn their living out of crime. That is the point that I was making to the hon. Gentleman, who made some very sensible points in his contribution.
	The prevention of wrongful convictions must be a key task, but the presentation of previous convictions in very limited circumstances can often be crucial. Let us take the issue of domestic violence. In such cases, a judge may well feel that someone who claimed vehemently that they had never been involved before in battering and destroying the life of a woman should have revealed to the court the fact that, three, four or more times in their relationship, they had done exactly the same. It is right that the jury should know that, especially as the defence lawyer knows it.
	The hon. Gentleman raised the issue of double jeopardy. I simply put it to him that the transformation of science and the use of DNA has now made it possible for us to have some not simply evidence but compelling evidence that someone was guilty of a crime. For that person to walk around in our community, capable of murder and rape, is a disgrace. In limited circumstances, the Director of Public Prosecutions will authorise, first, the investigation and, secondly, the submission to the Appeal Court. The Court of Appeal will then decide whether there is sufficient evidence to take the matter further, to protect us all from those who escaped justice in the first place.

Chris Mullin: Anything that makes our courts more efficient, effective and victim-friendly will be welcomed by most sensible people, as most of the proposed measures will no doubt be. However, I remain to be persuaded that the disclosure of previous convictions will not merely encourage the rounding up of the usual suspects. The Home Secretary gave an example of circumstances in which disclosure might be permitted, but surely there is a danger that the judge will allow disclosure when the Crown case is so weak that it might otherwise collapse.

David Blunkett: Yes, there is a danger. There will be a right of appeal in such circumstances, to ensure that the defence can challenge that basis of presumption, which will be the responsibility of the judiciary.

Edward Garnier: To want to protect victims and witnesses is not controversial. To require both parties to define the factual and legal issues should be as commonplace in the criminal process as it is in the civil process. That is accepted. However, I urge the right hon. Gentleman to accede to the request of my right hon. Friend the Member for West Dorset (Mr. Letwin), the shadow Home Secretary, to introduce legislation to codify the criminal law as quickly as possible. Had the law been codified, there would have been no need for the 12 criminal justice statutes introduced by this Government. We might have needed some of them, but not as many. We pass too many unnecessary laws dealing with criminal justice and I fear that the Home Secretary's statement will require us to pass more.
	Does the Home Secretary accept that admitting previous convictions into evidence is likely to be more prejudicial than probative? Does he also accept that abolishing the double jeopardy rule is likely to lead to more miscarriages of justice rather than to an increase in public confidence in our justice system? I am not going to get hysterical about what the Home Secretary said because I, too, want to participate in the debate in a sensible and rational way. The right hon. Gentleman says that he will listen. Once he has done that, will he also perhaps change his mind?

David Blunkett: Again, I welcome the tone of the hon. and learned Gentleman's contribution. I am prepared to listen to people's views on the safeguards that hon. Members and the public will require on the disclosure of previous convictions and in cases of double jeopardy. New compelling evidence will have to go through the triple locks that I described before a new case can be made and the previous verdict cancelled. Those provide a real safeguard for double jeopardy cases. We must take account of the knowledge that we now have, and we have the ability to convict the guilty, not the innocent. Justice is not only about protecting people from perpetrators, but about ensuring that those who we come to know are guilty are convicted as guilty.

Robert Marshall-Andrews: There has been a great deal of sound and fury in the media about the White Paper, signifying not very much. There is much in the document that hon. Members on both sides of the House and people throughout the criminal justice system will welcome. Before I ask three specific questions, may I point out that the test that my right hon. Friend adduced in deciding which criminal convictions should be relevant to the case and of assistance to the court is the test that we already have? It is not a new test. On the example that he gave, the previous convictions of a person who says that he has never violated a woman before would be considered relevant in any event. To enshrine the test in statute would not cause a great problem.
	There are three matters that do and, I anticipate, will cause problems, and I ask for my right hon. Friend's assistance. The first is double jeopardy. He gave the example of DNA evidence, and I certainly would not be against a specific provision relating to that.

Hon. Members: This is a speech.

Mr. Speaker: Order. The hon. and learned Gentleman is not in a courtroom. He asks only one question.

Robert Marshall-Andrews: May I therefore come to one question

Mr. Speaker: Order. Please have a seat. [Interruption.] Sit down. Secretary Blunkett, will you respond to the matters that have been put before you?

David Blunkett: First, I can confirm that I am aware of the Law Commission's work on previous convictions and I know that some of the practice, which is variable across the country, is insecure. That requires us to refine and extend provision so that people are very clear about what previous convictions apply and in which circumstances they can be used. Secondly, I am aware that there is concern among all hon. Members about double jeopardy. I seek to make my case this afternoon, and I shall seek to do so when we bring legislation before the House.

Lady Hermon: On behalf of my colleagues in the Ulster Unionist party, I warmly welcome the Home Secretary's statement. He will be aware that, in the past two years, there has been a review of the criminal justice system in Northern Ireland, culminating in the final stages of the Justice (Northern Ireland) Bill in the House last night. Can he ensure, in consultation with the Secretary of State for Northern Ireland, that the good changes that he recommends in his statement are also introduced in Northern Ireland?

David Blunkett: I would be very happy to talk to my right hon. Friend and I am grateful for the warm welcome that the hon. Lady has given my statement.

Lorna Fitzsimons: As a non-lawyer, but as somebody who has supported a child victim through the criminal justice system, I believe that the most dreadful thing is that the process destroys any concept of justice at such a young age. The proposals should enshrine changes to the process which instil in young people the courage to pursue the high principles of justice.
	Will my right hon. Friend ensure that the process makes as much common sense for ordinary non-legal people as possible? The process, rather than the end result, brutalises peoplethey understand the court system to a degree. It is often a matter of simple things such as prosecutors not being willing to talk to victims because they believe that victims play a minor role in the court process, rather than acknowledging that they play a central role, given that the crime happened to them.

David Blunkett: I entirely agree with my hon. Friend. I believe that a previous statement to the House addressed the issue of tailoring the youth justice system and the handling of youth witnesses in a way that lessened the adversarial nature of the court system in England and Wales. We learned a great deal from the Scottish experience, and have tried to ensure that young people's experience of the court system will encourage them to come forward as witnesses and to play a part in the system in future. All too often, that does not happen.

Douglas Hogg: I practise in the criminal courts, and, if that is an interest, then I declare it. While it is true that it is highly objectionable when a guilty person is acquitted, it is much worse when an innocent person is convicted. Against that background, does the right hon. Gentleman understand that the real concern is that the reduction in the right to jury trial and increased disclosure of previous convictions could lead to more miscarriages of justice? Will he reflect further on those proposals? I also suggest that in murder cases the trial judge should have the option of imposing a determinate sentence.

David Blunkett: On the latter point, we may well be close. However, the problem is that the judiciary and ourselves take slightly different views as to who is in charge of sentencing.
	On the right hon. and learned Gentleman's earlier question, I have already made my position on previous convictions clear. I want to make clear my position on mode of trial. We are dealing with serious complex fraud cases, of which we believe there will be about 15 to 20 every year. There may well be more in terms of detailed network organised crime and intimidation. The right to opt for jury trial will remain in all the cases that are currently outside the parameters that I described, including the extension of magistrates courts' sentencing powers. The leak of the document that was handed to The Independent may have misled people into believing something different.

David Winnick: In the light of what the Select Committee on Home Affairs said two years ago and what my right hon. Friend said today, is it not right that someone who has been acquitted of murder or another very serious offence should, if compelling evidence is produced, and if all the triple lock safeguards show that it should happen, be brought before the court again on the same charge? I ask my right hon. Friend this question. What sort of respect would it be to the memory of a loved one who has been murdered if a person has been acquitted, compelling evidence is found, and no further case can be brought, as is the position now? Surely justice demands, if only for the sake of the memory of that murdered person, that if there is such compelling evidence, and despite the earlier acquittal, the person concerned should be able to be charged accordingly.

David Blunkett: I agree with my hon. Friend that it is entirely wrong that such people should be allowed to go free while those whose lives were ruined by their child or other loved one being killed cannot get justice. It is a strange judicial system that can protect us from someone by putting them away for perjury, but not for the offence that they actually carried out.

Peter Lilley: In view of the Home Secretary's proposal that the right to jury trial be ended in the case of serious fraud casesin the apparent belief that juries are too bewildered by the complexity of fraud trials to convict, and that fraudsters exploit thatis he aware that over the past four years the Serious Fraud Office has had a 92 per cent. conviction rate in cases that it has brought? Does he expect the changes that he announced to result in an even higher conviction rate, a lower conviction rate or no change, and, if the latter, why bother?

David Blunkett: I am grateful for the notice of the right hon. Gentleman's question through this morning's edition of The Daily Telegraph. I adhere to three of his four principles, but I fall short on double jeopardywe simply disagree on that. Yes, I do expect more fraud cases to be brought and to be successful, because the current enormous difficulties arising from persuading people to take up jury service for prolonged, complex fraud cases lasting up to a year and dealing with them under the current arrangements will be overcome. A very large body of information now backs up our proposals.

Kevin Barron: On sentencing, my right hon. Friend may be aware of the conviction last year of a constituent of mine for causing six deaths in a road traffic accident while under the influence of drink. Recently, on appeal, his sentence was cut by one third. Does my right hon. Friend recognise the hurt that is felt not only by the families of the victims, but by many other people in my constituency who have had not only to suffer such an awful, terrible thing happening, but the reduction of the sentence on appeal?

David Blunkett: I share the frustration and anger that is felt by my hon. Friend and by many people who have spoken and written about the case. Home Secretaries are not supposed to comment on individual cases, but I intend to say this: when the technicalities of justice override the imperative of justice, we must do something about it. This was not a hit and run or someone simply knocking down other people or running into a carit was the most abominable disgrace imaginable. If murder is not the appropriate designation for such an incident, the House needs to examine what is. The case was and is a disgrace.

John Pugh: The Home Office proposes to spend 600 million on computers; that is a lot of money. Given the dismal history of Home Office computer procurementfew of us would trust its representatives on a trip to PC Worldwhat steps are being taken to ensure that the Government get value for money this time?

David Blunkett: I am always willing to accompany the hon. Gentleman to PC World because I need a bit of expertise on such occasions, as hon. Members probably clocked about a month ago.
	We have appointed an expert from the private sector as head of the division that is in charge of information technology in the criminal justice service. She is respected inside and outside government and will be able to lead us to better times and clearer waters.

Margaret Moran: May I metaphorically hug my right hon. Friend for the excellent references in the White Paper to domestic violence, especially in view of repeat victimisation? I especially welcome proposals to place on a statutory basis reviews of deaths in circumstances involving domestic violence. The all-party group on domestic violence called for that. We have campaigned on the fact that 15 childrenpossibly many morehave been murdered in such circumstances. It is about time that we learned the lessons about prevention and minimising risks.
	I welcome the proposal to make a breach of non-molestation orders a criminal rather than a civil offence to afford survivors the protection that they desperately need. Does my right hon. Friend agree that we need specific legislation on domestic violence, given that the current legislation is 26 years old, to progress with some of the worthy measures in the consultation document?

David Blunkett: I am tickled by the offer of a hug, which I shall have to consider.
	This country has an enormous problem of domestic violence. I pay tribute to the Solicitor-General, who is working closely with the Minister for Policing, Crime Reduction and Community Safety on that to enable us to get our act together. Breaching non-molestation orders will be made a criminal offence, and we will extend the restraining order to ensure that victims are protected in circumstances in which it is currently possible for further attacks to occur. As part of extending the police power on bail, we will also ensure that people cannot return to the immediate area where they are threatening their former partners or wives. It is important to remind ourselves that a third of all murdered women are killed in a domestic situation.

George Osborne: I agree with the Home Secretary's comments about justice not only being done but being seen to be done. A local criminal justice system has historically been one method of achieving that. Yet in my constituency and many others, under Governments of all persuasions, magistrates courts have closed. My Crown court now faces closure. Does the right hon. Gentleman agree that that is counter-productive and that an effective criminal justice system is rooted in the local community?

David Blunkett: I agree that access to justice is important, and that that means that people can reach it reasonably and easily. The Lord Chancellor, the Attorney-General and I need to examine the best method of ensuring that combining the relevant parts of the court system facilitates that rather than makes matters worse.

Andy Reed: I am sure that my right hon. Friend's statement has reassured many hon. Members of all parties about some of the controversial elements of the debate that will ensue. However, I declare an interest as a non-lawyer. Will he ensure that he gives equal weight to the voices of victims and those at the sharp end of the criminal justice system and the lawyers inside and outside this place, and not simply listen to the latter?

David Blunkett: I certainly will. I want to make it clear that I am genuinely very fond of lawyers; I even have friends who are lawyers.

Andrew MacKay: Does the Home Secretary agree that today public confidence in the criminal justice system is so dangerously low that this House needs to act urgently? To that end, does he understand that, providing that there are proper safeguards, the House should support his proposals first to end the double jeopardy rule, secondly in very special circumstances to allow previous convictions to be mentioned in court, and thirdly in very special casesserious fraud and where there is gross intimidationto have, rightly and properly, not a jury but a judge?

David Blunkett: I strongly welcome those comments. I want to make it clear again that there are differing views among members of all parties in the House, and if we can accept that, we can consult and work together. The example of support given today reinforces the need for us to gain consensus and to find a lasting way forwardrather than, as we say in the White Paper and for which the shadow Home Secretary chided us, having layer on layer of legislation that ends up having to be re-amended.

Frank Cook: Will the Home Secretary accept from me the assurance that the vast majority of my constituents and much of the population on Teesside will greet his announcement with the beginnings of relief and gratitudenot least Ann and Charlie Ming, the parents of Julie Hogg, who was brutally murdered some years ago and stuffed behind a panel at her home?
	In pursuing the course of double jeopardy, I assure the Home Secretary of my continuing support, but I ask him to respond to one anxiety that I feel. If we make compelling new evidence a condition of a new trialand we must do so; I understand thathow can we be certain that, in following the trial, the jury considering it will not find the fact that that evidence has been assessed as compelling new evidence some pre-judicial circumstance?

David Blunkett: There is a genuine question about what assumptions may be made about the Appeal Court deciding to go ahead and about the information in relation to the case that is already in the public arena. There are genuine problems, but I think that we can overcome them; the parents of Julie Hogg would want all of us to find a way round them.

John Burnett: Will the Home Secretary please pass my thanks to the Attorney-General for having the courtesy to meet me and the hon. Member for Stone (Mr. Cash) yesterday to discuss the White Paper, and for sending me an early copy of it? I welcome the earlier Crown Prosecution Service involvement in the criminal process. It is for the Government to ensure that the CPS has sufficient personnel with expertise and sufficient equipment adequately to discharge that function. I hope that the right hon. Gentleman will discuss with the Attorney-General the unacceptably high de minimis levels set for the Serious Fraud Office before it may investigate a matter.

David Blunkett: Those welcome comments illustrate the difficulty raised in my reply to his hon. Friend the Member for Southwark, North and Bermondsey (Simon Hughes) about the number of convictions achieved at the moment owing to the difficulties experienced by the Serious Fraud Office in reaching a position where it can take cases to trial. Any sensible suggestions from the hon. Member for Torridge and West Devon (Mr. Burnett) will be welcome.

Fiona Mactaggart: May I congratulate the Home Secretary on resisting the siren voices who suggested that the best way to create an effective justice system was to withdraw rights from the accused, and on instead emphasising the protection of the rights of witnesses and improving efficiency and effectiveness through, for example, the proposals on domestic violence, which could save the lives of two women a week, as at present two women each week are murdered by their partner or ex-partner?
	Will this House have an opportunity to discuss the guidance that will be given to judges about when they can decide whether prior convictions are relevant and will not prejudice a trial? Politicians may have a particular view to express to judgeswho are the right people to take such decisionsabout the circumstances in which they can allow previous convictions to be considered.

David Blunkett: I hope that we will be able to debate that in a sensible and open fashion when the legislation is introduced. I also hope that we will be able to do so as part of a broader debate about sentencing guidelines, counsel, and the role of Parliament vis--vis the sentencing system, without interfering with or in any way undermining the role of the judiciary and its independence on these matters. It is a matter of great frustration to members of the public whom I meet that they expect us to have some influence and direction over policy, only to find that we really do not. If we can get the balance right without interfering with judicial independence, we will achieve a great deal more credibility for democracy as well as for the criminal justice system.

Julian Brazier: May I join in the general welcome for the statement that we have just received, while echoing the concern of the hon. Member for Rochdale (Mrs. Fitzsimons) in saying that there seems to be very little here for child witnesses in court? I urge the Home Secretary to look at the Scottish experience, and to consider introducing more training for judges in trials involving child witnesses, to discourage defence barristers from bullying the children, from confusing them by using double negatives in cross-examination, and from trying to undermine them by using points of order to create delays before the interrogation starts.

David Blunkett: I can give the hon. Gentleman an assurance that we need to look at those issues, together with the way in which evidence can be presented. Although we cannot avoid cross-examination taking place in alternative ways, we can use simple technology to enable the presentation of the witness's case by very young children to be undertaken more effectively.

David Taylor: As a member of the Magistrates Association, and a supplemental magistrate on the Ashby-de-la-Zouch petty sessional division in Leicestershire, may I give a warm welcome to the White Paper? It has taken the first non-lawyer Home Secretary for two decades to bring some sense to the judicial system, particularly in relation to the extension of the sentencing powers of magistrates courts from six to 12 monthsand, perhaps, ultimately, 18 months. I also welcome the rejection of the Auld proposal for an intermediate tier of court. May I express a note of concern, however? In his statement, my right hon. Friend said, In time, we will integrate the management of the courts into a single organisation. Is there not a risk that that single organisation might see greater attractions in fewer, more remote and centralised courts? Will my right hon. Friend give us an assurance that local magistrates courts are going to be safer under that new, integrated organisation?

David Blunkett: As part of the integration, and as a result of the way in which the Attorney-General and the Solicitor-General have been working with us to ensure that access to justice is sealed, we are considering the development of a new local board, which will integrate the work and also have a more powerful local voice to draw together the needs of a local community as well as improve the efficiency of the system.
	I welcome what my hon. Friend said about being a magistrate. When I consulted on the Halliday sentencing proposals, there was great scepticism among the magistrates I met as to whether the Government would listen to them, or whether this was a fait accompli. We insisted, on these proposals and on Auld, that there would not be a fait accompli, and I think that we can now reassure those magistrates that we have genuinely listened and responded.

Julie Kirkbride: May I also give a warm welcome to the Home Secretary's sensible proposals today? In particular, many of my constituents will be pleased to learn that he intends to ensure that some prisoners serving a life sentence will actually serve a whole life tariff, and that, in some circumstances in which prisoners would be a danger to the community, they will remain behind bars. There is concern, however, that the powers that he intends to take will be anathema to the European Court of Human Rights, which has so far shown a remarkable determination to remove from his office the right to determine the tariff served by prisoners serving life sentences. Will he explain to the House how he intends to make the proposals robust in those circumstances?

David Blunkett: Let me be uncharacteristically cautious on this matter. There are cases, including Anderson and Taylor, on which considerable public comment has been made, including comment by people who have responsibility in this area, and I do not wish to match that. However, I think it very important that everyone should know that there will be, and I am determined that we find, ways around any blockagewhether a case is taken to Strasbourg or notthat precludes this Parliament from determining that those who have committed the most horrendous crimes should be locked away for ever, given that the sentence was seen as an alternative to putting people to death. I remind those who debate these issuesoften, they are rather contemptuous of the more common language that some of us usethat we in this country are in a position not to put people to death, but to demand a punishment that is clear and decisive, and which protects us from the most horrendous murderers. In that respect, I agree entirely with the hon. Lady.

Ann Cryer: I thank my right hon. Friend and his team for the attention devoted in his comments and in the White Paper to the horrendous issue of domestic violence. At the moment, I am dealing with one domestic violence case every two or three weeks. Those women have had an horrendous time, and if it were not for the help of the Keighley Domestic Violence Servicea voluntary organisationthey would remain in a violent relationship or simply be dumped with no help. Thanks to the service, they are brought to my office for help, and brought to the attention of the police and the social services. I want to put on the record my grateful thanks to that service, which is doubtless replicated in other constituencies. The people who run it do a wonderful job, but they do not receive much thanks.

David Blunkett: Those people deserve every thanks. I have been persuaded by my right hon. and learned Friend the Solicitor-GeneralI give her credit this afternoonthat we should return to this issue with vigour in the autumn. We have already taken steps, such as changing attitudes. Moreover, police throughout the country make the presumption of pro-arrest in relation to domestic violence. Those steps have already begun to make a difference, but voluntary groups and people who give of their time are a godsend to those who face horrendous attack.

Andrew Selous: Can the Home Secretary tell the House what he intends to do about the problem of retaining police officers in forces around London who transfer to the Metropolitan police? Anyone in Bedfordshire who joins the Metropolitan police is between 5,000 to 7,000 a year better off because of London housing allowances and the free travel provided within 70 miles of Charing Cross. This is a question of the allocation of the cake, not of its size.

David Blunkett: Yes, it is a real issueone that the White Paper does not addressfor places such as Bedfordshire and the Thames valley. My right hon. Friend the Minister for Policing, Crime Reduction and Community Safety and I will discuss with chief constables ways to avoid the problem spreading still further, with ring after ring facing a similar situation as we gradually alter the balance. Having put right the massive recruitment problem in the Met, we need to balance that through retention in the immediate non-Met areas.

Stephen Ladyman: My right hon. Friend will know that I have deep reservations about the prospect of changing the double jeopardy rule, but in the spirit of today's statement, I am prepared to engage in the consultation and give him a chance to convince me otherwise. To start that process, I would like him to expand on two issues. First, how will we ensure that the trial jury at the second trial has not been prejudiced by the pre-trial process of deciding that the evidence is new and compelling? Secondly, what does he mean by new? Does he mean evidence that could not possibly have been submitted at the first trial, or evidence that would have come to light at that trial, had the investigation been extended for long enough?

David Blunkett: My hon. Friend raises very reasonable questions, the first of which I referred to in my reply to my hon. Friend the Member for Stockton, North (Mr. Cook). On the second question, I believe sincerely that we are, and should be, talking about new evidence that was not available originally. I gave the example of DNA because it has extended our ability to ascertain guilt in a way that was never envisaged 10 or 15 years ago. There are also peoplemy hon. Friend the Member for Stockton, North will be aware of thiswho have written about their guilt afterwards and explained what they did. Changing the double jeopardy law makes all the difference to our capacity to follow through on that.

David Borrow: May I raise with my right hon. Friend the problem of the high reoffending rates of young offenders when they leave prison or a young offenders institution? I have seen work done by the YMCA both in young offenders institutions and prisons and on release, and am convinced that a lot of the good work done in those institutions is wasted when young people leave them and return to the environment that put them in prison in the first place. There are schemes that can provide assistance, but unless we remove the need for young people to go back on release to the very environment that created the problems in the first place, we are simply not tackling the root of the problem. I should be grateful if my right hon. Friend would introduce measures to improve the schemes already in place to help young offenders on release.

David Blunkett: We are publishing today a second paper in response to a consultation on rehabilitation. There is a real need to join up prison and probation, rehabilitative and reparation services, and tackle the follow-through on things like drugswork taking place in prison must continue on release. Alongside an independent review of all correctional services, the pressures on them and requirements for the future, we should take seriously the need to create a genuinely seamless service.

Andrew Miller: Without a shadow of a doubt, the White Paper will be welcomed throughout my constituency. However, will my right hon. Friend comment on a narrow point about the commissioner for victims, and confirm that his remit will include dealing with victims of death and serious injury on the road? May I tell my right hon. Friend how refreshing it has been to deal with Ministers and officials in all three arms of the criminal justice system who have taken a fresh look at that important area of crime?

David Blunkett: I can give that assurance. The White Paper engages specifically with the support required for trauma involved in major catastrophes, but not catastrophes that affect just one family.

Vera Baird: There is much to welcome in my right hon. Friend's statement. I note that many contentious issues are couched in conditional terms about consulting and so on, and I applaud that open-mindedness. I join colleagues who have praised the attention that will now be given to domestic violence. I hope that that will spell an end to the old notion that crime committed against the family at home is a private matter in which the state must not intervene.
	May I ask three short questions? First, forgive me if this is my error, but I am unclear as to whether the abolition of the double jeopardy rule will be retrospective, and thus capable of giving satisfaction to the family close to the hearts of Teessiders to whom my hon. Friend the Member for Stockton, North (Mr. Cook) has referred. Secondly, what does my right hon. Friend mean in the White Paper when he talks about people accused of organised and serious crime not having the right to jury trial? It sounds as if the more serious the crime, the less the chance of a jury trial. Surely, trial by one's peers is the most important principle when the consequences are grave. Finally, will my right hon. Friend's review of the rules of evidence include a fresh look at the admission of previous sexual history in rape trials?

David Blunkett: On the first question, yes, it will be retrospective. On the second question, it is critical that we get the definitions right, and once more I welcome my hon. and learned Friend's contribution to the debate. We are talking about networks of organised criminals, often with international links, who are engaged in subterranean financial activities. Our advice is that there are major problems with the present system. On the final question, the answer is yes.

Gareth Thomas: I too warmly welcome the statement and, as one who has practised in the criminal courts, I agree about the need to rebalance the criminal justice system. May I, however, press my right hon. Friend on the question of disclosure of previous convictions? What criteria will be applied before such convictions are adduced in evidence?

David Blunkett: We have deliberately made it clear not just that we need discussion about that, but that we need to provide some discretion for the judiciary. We cannot say that we need to respect the independence and professionalism of the judiciary, and in the next breath say that we are taking it away. I am mindful of the need to get the definition right, but we also need to ensure that there is enough leeway for account to be taken of individual circumstances.

Roger Casale: I welcome the statement. I know from my contact with Dru Sharpling, the new head of the Crown Prosecution Service in London, and with Eric Packer, the clerk of Wimbledon magistrates court, that the reforms will be particularly welcome in London. People throughout London want to see a step change in the quality of the criminal justice system, and to have confidence in it. Does my right hon. Friend agree, however, that if the reforms are to be effective, appropriate financial commitments will be needed to back them up? Is it not the case that when we all come to be judged by the jury that is the electorate, this Government will not be accused of having willed the ends without willing the means, whereas the Conservative party is likely to be found guilty of that charge?

David Blunkett: I entirely agree, but I am always circumspect when, as happened earlier, the Chancellor is present and the Chief Secretary to the Treasury is at my elbow. It is important to recognise that this is a blueprint for the years ahead, not just for two years ahead.
	As for my hon. Friend's main point, there is a real challenge for the criminal justice system, from the police through the Crown Prosecution Service through the courts to restorative justice in London. London is materially different from other parts of the country in this regard. We really do need the step change to which my hon. Friend referred if we are to deliver something materially different to Londoners who feel let down by the present system.

Points of Order

Tom Harris: On a point of order, Madam Deputy Speaker. At Prime Minister's Question Time, when discussing the Proceeds of Crime Bill, the Leader of the Opposition referred to a position not actually held by the Conservative party. He suggested that, during the passage of that Bill, his party had supported measures for the confiscation of

Madam Deputy Speaker: Order. This cannot be an extension of Question Time.

Theresa May: On a point of order, Madam Deputy Speaker. At 8 pm today, a 24-hour strike will begin on London Underground. It will close the network, causing travel chaos across London and havoc for the tube's 3 million users. Yet so far there has been a deafening silence on the issue from the Secretary of State for Transport.
	Given that the Government's botched public-private partnership for London Underground has now been further delayed by legal challenge and by the wait for the European Commission's decision on state aid, the Government have an opportunity to try to introduce a no-strike deal. Have you, Madam Deputy Speaker, had any indication from the Secretary of State that he intends to make a statement to the House condemning tomorrow's strike and saying what action the Government will take to prevent further such disruption?

Madam Deputy Speaker: I have had no indication from any Minister that he or she intends to come to the House.

James Gray: On a point of order, Madam Deputy Speaker. I am very concerned about the possibility that the Secretary of State for Defence has inadvertently misled the House, and I want to give him an opportunity to correct the wrong impression that he gave us.
	On 9 July, the Secretary of State answered two questionsone from my hon. Friend the Member for North Essex (Mr. Jenkin) and one from mesimultaneously. Both concerned aspects of the sale of ships, in particular to the Government of Thailand. The Under-Secretary of State for Defence, the hon. Member for Kirkcaldy (Dr. Moonie), told my hon. Friend that he had
	received no formal expressions of interest from the Government of Thailand about the purchase of Royal Naval warships.[Official Report, 9 July 2002; Vol. 388, c. 852W.]
	On the same day the Minister told me that the Secretary of State for Defence had discussions,
	during his recent visit to Thailand, with his Thai counterpart and other senior Thai officials in support of proposals put forward
	to sell warships. It seems to me that those two answers are incompatible. One or the other must be inadvertently misleading to the House. Would not it be right for the Secretary of State to come to the Dispatch Box to correct the misinformation?

Madam Deputy Speaker: The main business before the House today is a debate on defence procurement. Perhaps it would be more appropriate for the hon. Gentleman to raise the matter then.

Mark Francois: Further to the original point of order, Madam Deputy Speaker. The operation of the underground is important to my constituents, many of whom use it

Madam Deputy Speaker: Order. I have ruled already that that is not a point of order for the Chair.

BILL PRESENTED

Child Abuse Deaths

Mr. Paul Burstow presented a Bill to place Area Child Protection Committees on a statutory footing; to make provision for appropriate resources to establish Child Death Review Teams; to provide child protection training for all professionals in contact with children; to provide independent counselling schemes; and to appoint a Children's Commissioner in all parts of the United Kingdom: And the same was read the First time; and ordered to be read a Second time on 19 July, and to be printed [Bill 183].

Respite Care (Children)

Tony Baldry: I beg to move,
	That leave be given to bring in a Bill to amend the Children Act 1989 to make it mandatory for local authorities to safeguard and promote the welfare of children within their area who are in need and to ensure that children with severe disabilities receive similar levels of respite care from local authorities as other vulnerable members of the community.
	This Bill would substitute the word may with must in subsections (3) and (6) of clause 17 of the Children Act 1989, part III. The change would make it mandatory for local authorities to safeguard and promote the welfare of children within their areas who are in need, to promote the upbringing of such children by their families, and to facilitate the provision of these services by voluntary organisations to ensure that children with severe disabilities receive the same levels of respite care from local authorities as other vulnerable members of the community.
	If hon. Members were asked whether their local authority was suffering a social services crisis, at least eight out of 10 should answer yes. Eight out of ten is not some random statistic: it is the number of local authorities where, as is the case with Oxfordshire county council, the demand for social services is clearly outstripping resources.
	That shortfall of funding is no more evident than with respite care services for children with severe disabilities. Currently, the responsibility for local authorities to provide such discretionary services is a matter of may rather than must. Thus, in the pecking order, those discretionary services come after statutory provision. Where money is tight, they simply fall off the edge.
	I am sure that local authorities would welcome a Bill ensuring that the provision of respite care for children was a statutory responsibility that should be properly funded by the Government. In Oxfordshire, the number of respite care centres is likely to be reduced this year from five to three. Parents have managed to save Sycamore house in my constituency, but Chilterns house in the constituency of my hon. Friend the Member for Henley (Mr. Johnson), a sponsor of the Bill, has been lost.
	The Bill would simply amend subsections (3) and (6) of section 17 of part III of the Children's Act 1989 by changing the word may in both subsections to must. Of course, that would mean much more than simply a change of words for parents whose children have complex needs. It would help transform their lives by making the respite care arrangements for their children more secure and stable.
	Stability is paramount. Initially, Oxfordshire county council thought that it would have to abandon children's respite care provision altogether. After a lot of heartache and lobbying, it has managed to put together a compromise scheme with the local health authority.
	The law at present states:
	any service provided by an authority . . . may be provided for the family of a particular child in need or for any member of his family.
	The House will note that the word may is used, not must. I am not sure that every social services provider has such vocal and committed parent groups as Oxfordshire's Friends of Oxfordshire Respite Centres, known as FORCE, nor such a pragmatic county council. The Bill would ensure that all local authorities would have an obligation, not the discretion, to provide the stability of respite care centres that children with severe disabilities, and their parents, need.
	Barnardos, which has helped fund respite care in Oxfordshire, has indicated that it will consider its financial contribution to the partnership in Oxfordshire further. It may at some stage be able to revise and enhance its contribution to the partnership, but that will depend on achieving the partnership that I have described. The proposed partnership to save the respite care centres can happen only if Oxfordshire county council has the funds in the future. Barnardos needs financial stability, which should come from the county council's own financial stability, to stabilise respite care provision for parents whose children have learning difficulties.
	All too often, voluntary or charitable organisations commit money only to see the statutory foundation funding from social services withdrawn. The stability on which parents depend is dependent on the stability of social services spending and the money received from central Government for social services.
	A letter that I recently received from a parent whose child benefits from Sycamore house said:
	I am asking for your help . . . surely the government can see the need of parents such as ours and sort out the financial situation so social services can help Barnardo's keep such a vital service for our disabled children and families, not only for the coming year, but for future children and families of disabled children.
	The provision of such critical services depends on proper central Government funding, which offers stability for local authority social services budgets. Of course, county councils can raise council tax to cover shortfalls, as Oxfordshire did. It involved a hike this year of 86 on a band D council tax bill, and still left a proposal to close these homes.
	The reason why Oxfordshire's social services have deteriorated to their current extent is that Oxfordshire receives considerably less funding than other neighbouring counties and unitary authorities. Nearby Milton Keynes, for example, gets nearly a fifth more investment than Oxfordshire from central Government. Hampshire and Hertfordshire, moreover, get twice the budget specific to respite care centres than Oxfordshire. Yet clearly the cost of living, the cost of staff and the cost of care are the same in all three areas. I am at a loss to understand why the Government believe that Oxfordshire should have the lowest allocation of funds under the grant system when its cost of living is among the highest in the country.
	I am concerned that although several Departments recognise the problem, apparently the Department of Health does not. I and other Oxfordshire Members tabled an early-day motion on the issue before the last standard spending assessment round was allocated last year but, unfortunately, our warnings clearly fell on deaf ears.
	If Oxfordshire's social services have to survive with less funding than they need until 2004, more vital services will almost certainly be withdrawn, so imagine my concern last week when the Office of the Deputy Prime Minister announced a review of local authority funding. The review will, we are promised, want new formulae that are fairer, simpler, more intelligible and more stable. It sounds good, but then we get to the detail. Buried away in the Government's document is a sentence that rather alarmingly admits:
	any system based on formulae cannot reflect all possible circumstances, so there will inevitably be an element of rough justice.
	Then there is the caveat that such rough justice
	tends to be increased as formulae are made simpler.
	I have done some back-of-an-envelope calculations of what fairer and simpler funding will mean for Oxfordshire in the light of my Bill's proposals. Rough justice is an underestimate if ever there were one. Of the four basic options for an alternative to the present SSA advanced by the Government, the worst for Oxfordshire could leave a 43 million hole in the county council's budget. That is equivalent to 10 per cent. of the county council's resources. It would add a further 192 to council taxa 25 per cent. increasewhich is simply not sustainable.
	Education would be the biggest loser for Oxfordshire. Education is an important part of the county council's plans for Oxfordshire's respite care centres with after school, play and leisure clubs for children with complex needs. How could those services continue under the Government's funding options?
	Ministers have said that Oxfordshire local education authority has a good record on finding places in schools for children with severe disabilities. How will that be maintained? Although I might have more chance of developing post-Einsteinian unified theory than fully understanding the Government's proposal for local authority finance, my figures are supported by the Local Government Association.
	No one should doubt the need for respite care centres. I, along with Oxfordshire parliamentary colleagues sponsoring the Bill, have spent a lot of time listening to parents with disabled children in need of respite care in the county. I close my comments by reading a letter, not from a councillor or a parent, but the 12-year-old sister of a child receiving respite care. She says:
	I spend a lot of time on my own, upstairs in my room, even my friends won't come around because of my sister and only about twice a month for one night I get to do what a lot of regular young teens take for granted.
	Further slashing of central Government funding for counties such as Oxfordshire will mean further cuts in social services, including respite care. Children with severe disabilities deserve protection; they deserve opportunities for respite care. This should be a must obligation for local authorities and the Government should ensure the funds for respite care services. That is what the Bill intends to achieve.
	Question put and agreed to.
	Bill ordered to be brought in by Tony Baldry, Mr. David Cameron, Dr. Evan Harris, Mr. Robert Jackson, and Mr. Boris Johnson.

Respite Care (Children)

Tony Baldry accordingly presented a Bill to amend the Children Act 1989 to make it mandatory for local authorities to safeguard and promote the welfare of children within their area who are in need and to ensure that children with severe disabilities receive similar levels of respite care from local authorities as other vulnerable members of the community: And the same was read the First time; and ordered to be read a Second time on Friday 19 July, and to be printed [Bill 184].

EUROPEAN COMMUNITY DOCUMENTS

Motion made, and Question put forthwith, pursuant to Standing Order No. 119(9) (European Standing Committees),

Preliminary Draft Budget

That this House takes note of the unnumbered Explanatory Memorandum from HM Treasury dated 5th July 2002 relating to the Preliminary Draft General Budget of the European Communities for the financial year 2003; and supports the Government's efforts to maintain budget discipline in the Community.[Mr. Sutcliffe.]
	Question agreed to.

DELEGATED LEGISLATION

Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Terrorism

That the draft Terrorism Act 2000 (Cessation of Effect of section 76) Order 2002, which was laid before this House on 27th June, be approved.[Mr. Sutcliffe.]
	Question agreed to.

Defence Procurement

[Relevant document: The Fourth Report from the Defence Committee, Session 200102, HC 779, on Major Procurement Projects.]
	Motion made, and Question proposed, That this House do now adjourn.[Mr. Sutcliffe.]

Adam Ingram: I welcome the official Opposition's support for the Government's announcement on defence spending. Monday's announcement by the Chancellor represents the biggest sustained real increase in defence spending plans for 20 years.
	That is excellent news for defence. The 2000 spending review provided the first sustained growth in the defence budget since the end of the cold war: an annual average of about 0.3 per cent. over the three years. This year's spending review has gone further, providing for real annual growth of 1.2 per cent. over the next three years. In real terms, it represents new money: in year one

David Laws: Will the right hon. Gentleman give way?

Adam Ingram: Perhaps the hon. Gentleman will let me give the figureshe may not have heard them yet.
	In year one, the amount will be 725 million. In year two, it will be 798 million and in year three, 1.047 billion. Unlike the years of Tory decline, when it comes to defence, Labour means business.

David Laws: Is the Minister aware that Treasury officials, in evidence this morning to the Select Committee on Defence, confirmed that defence expenditure in real terms would be lower in every year of the spending review than it was last year?

Adam Ingram: I should like to see the transcript of the evidence. It is certainly worth examining any advice given by Treasury officials, but we have to be cautious in interpreting it. I should rather take advice from Departments than from the hon. Gentleman.
	I hope that the Opposition's support for our new budget extends to our programme of radical, realistic reform that underpins it. Based on our approach of maximising support to the front line, that has meant an extensive and ongoing overhaul of our delivery of support services to our Navy, Army and Air Force. Difficult decisions have had to be made, and there are more in the pipeline.
	I want to make it clear from the outset that we will not flinch from those decisions, because it is important that we get it right. We must make best and efficient use of our newly increased budget; more money to spend does not mean less focus on effective delivery. Indeed, the very opposite applies. We need to get real value for our defence pound.
	Against that background, I welcome this opportunity to outline our progress in delivering the programme of equipment modernisation set in hand after the strategic defence review to ensure that we have capable and effective armed forces, properly equipped for the tasks that we ask our service men and women to undertake.
	The SDR set us firmly on the right track for making sure that our armed forces can meet the demands of today's and tomorrow's operations. It identified a range of improvements to our capabilities, especially to enhance the ability of the armed forces to conduct expeditionary operations.
	Of course a great deal has happened since the SDR and since we last debated defence procurement in October 2000. The events of 11 September last year shocked us all. In response, we have looked afresh at our defence posture and plans. In doing that, we have not set aside the conclusions of the strategic defence review; rather, we have described this work as a new chapter building on the assumptions that we made and the conclusions that we reached during the SDR.
	The new chapter work has considered the extent to which the strategic context has changed and how we might best engage in tackling both the symptoms and causes of terrorism. It has also focused on the balance between home defence and countering threats abroad, and on how to enhance the effectiveness of our military contribution to both.
	Further conclusions on the wider aspects of the new chapter review will be published in a White Paper tomorrow and, clearly, I do not want to anticipate that now. But I can give some broad indications of the likely consequences for our forward equipment programme. It will not surprise the House that we are likely to see a continued emphasis on rapid deployment, intelligence gathering and precision strike capabilities. That is consistent with the conclusions of the SDR, although some further enhancements in those areas will be needed.
	In particular, we are moving in the direction of what is called network-centric capability, bringing together sensors and strike assets to enable the controlled, precise and rapid delivery of military effect. We will therefore want to look at enhancements to our capability to acquire and analyse information, get the information to those who need it and the precision strike capabilities to turn it into results. My right hon. Friend the Secretary of State for Defence will make a full statement tomorrow, setting out our conclusions on the new chapter work and the implications for defence capability.

Llew Smith: In the past, we have purchased nuclear weapons from the United States. In what situations would the Government be willing to use those weapons of mass destruction?

Adam Ingram: My hon. Friend should be aware that we never set out the scenarios in which those weapons would be put to use, although my right hon. Friend the Secretary of State has made it clear time and time again, at this Dispatch Box and elsewhere, that, in the right circumstances, the weapons would be used. That is the purpose for their existence as part of our force capabilities.

Llew Smith: Will the Minister give way?

Adam Ingram: No, I have dealt with that point. The issue concerns the use of equipment rather than its capabilities. My hon. Friend has had the opportunity of hearing my right hon. Friend the Secretary of State explaining time and time again about that part of our equipment capability.
	The settlement for defence agreed as part of the 2002 spending review, and announced by my right hon. Friend the Chancellor on Monday, will provide a firm foundation for moving forward with the new chapter. It will offer in particular an opportunity to make the further investment necessary to deliver the enhanced capabilities that the new chapter work tells us we need. The Government have made available 1 billion of new capital investment and 500 million of new resources to take the work forward. My right hon. Friend the Secretary of State for Defence will provide more details on this tomorrow, but it is clear that the settlement is very good news for defence.

James Gray: Will the Minister give way?

Adam Ingram: Given the sparse presence on the Conservative Benches behind him, the hon. Gentleman will have plenty of opportunity to take all the time that he wants to set forth his arguments. But I shall certainly give way to him.

James Gray: I am grateful to the Minister for giving way so early in his speech. He is right that I may have a few moments to speak later, if I am lucky enough to catch your eye, Madam Deputy Speaker. The Minister has talked about the switch to resource accounting and, particularly, on 1 April 2003, he will have to take account of depreciation and carry-over costs of some 12.2 billion, in addition to current costs. Has he taken those figures into consideration in coming up with the figure of 3.5 billion to which he has referred?

Adam Ingram: The answer is yes. I suggest that the hon. Gentleman look at the make-up of the figures for the three-year programme, which have been published by the Treasury, and the way in which those figures are affected by taking account of depreciation. It is important to take account of those non-cash items; doing otherwise would, in a sense, be false accounting. Those realistic aspects of the Budget settlement have to be taken into account.

Mike Hancock: Will the Minister give way?

Adam Ingram: The debate is about procurement issues, and we should deal with them. Some hon. Members may have doubts about whether the settlement can meet the demands, but they have not yet heard what I have to say about our procurement programme. I do not know whether the hon. Gentleman wants to rush away to get home, but if he cares to hold on, I may give way to him when he has, I hope, absorbed some of the other information that I will impart to him and his hon. Friends.
	Since 11 September, British armed forces have been actively engaged in the war against terrorism in operations against al-Qaeda and Taliban forces in Afghanistan. The challenges of mounting and sustaining operations at that range and in such a harsh environment should not be underestimated. It is a credit to our service men and women and their equipment that United Kingdom forces were able to make the contribution that they did, alongside American and other allies.
	Some 155 million was made available to the Ministry of Defence to fund additional equipment and other urgent operational requirements. A number of significantly enhanced capabilities specifically needed for that campaign, such as lightweight hand-held thermal imagers, night vision goggles and additional secure communications equipment, were brought into service rapidly and deployed to good and powerful effect. I acknowledge, however, that all that has not been trouble-free. In the extreme conditions in Afghanistan, all weapon systems are at risk of developing problems. Hon. Members will be aware that, in particular, there have been reports of stoppages with the upgraded SA80 weapon.
	Let me assure the House that Ministers take any reported shortcomings in the SA80 very seriously indeed. We attach considerable importance to making sure that our service personnel have reliable and effective equipment that is up to the job. Indeed, that was one reason why I insisted that troops deploying to Afghanistan should take the modified SA80 with them. Notwithstanding the problems encountered there, the SA80 A2 is a more capable and much more reliable weapon than its predecessor. The question is whether it is good enough.
	The modified SA80 performed very well during the trials in highly demanding conditions, but, given the new reports, a full and thorough investigation has been set in hand. Specialists have been sent to Afghanistan to assess the problems at first hand with the Royal Marines and to conduct test firings under typical operational conditions. That team has now completed its work and is preparing, as a matter of urgency, a full report on its findings. It would be inappropriate for me to comment further until the investigation team's report has been received and its findings assessed.

John Smith: I am reassured by my right hon. Friend's comments on the SA80's performance, but is that not a typical example of why we must get our procurement right? We inherited that gun from the previous Government with very severe problems, and we have had to invest a lot of money to get it absolutely right now. We need to avoid such problems in future.

Adam Ingram: It is easy to apportion blame. It is true that the SA80 was procured under the previous Government. Notwithstanding the extensive upgrade programme90 million was spent on itand the intensive testing, we must now analyse the concerns that have been raised and find a way forward. I take my hon. Friend's point, and hon. Members know that he makes his point well. He is apportioning blame, but I want to ensure that we get this right.

Paul Keetch: The Minister is right, and I welcome the news that he has just given. Will he assure the House and, more importantly, the men and women who carry the SA80 that, if that report shows any doubt at all about that weapons's serviceability and record, the Government will be prepared to procure a different rifle, if not for the entire British armed forces, at least for those infantry, special forces, paratroops, Marines and so on who might use it in battle?

Adam Ingram: That is perhaps a step too far. The hon. Gentleman should not use language that could somehow lead to a lack of confidence in what is a very sophisticated rifle, which, unfortunately, in some reports, has been shown not to have performed as well as we anticipated that it would in the extreme circumstances of Afghanistan.

David Burnside: Will the Minister give way?

Adam Ingram: Let me answer this question first. We must assess the problem, analyse it, and test the rifle against other potential rifles while remembering that not all of them may have been tested in those extreme conditions. It is easy to jump from one rifle to another, saying that the other is better, but all that testing must take place. Let me therefore judge the options once I have the analysis.

David Burnside: Will the Minister confirm that other weapons are already used by special forces, including in Afghanistan? The problem being raised is not relevant to many operational forces, at present, who are using a Heckler and Koch.

Adam Ingram: I shall not comment on what special forces may or may not use in theatre. Clearly, as I said in my earlier response, we must carry out that detailed analysis. We must consider that rifle in connection with other equivalent weapon systems.

Mike Hancock: I hope that I shall have the chance later to make the point on which I wanted to intervene earlier.
	On this point, the Minister referred to the extensive testing of the weapon prior to and after its modification. What were the extreme conditions in Afghanistan that were not tested during the extensive testing and after the 92 million had been spent? Having spoken to troops who have recently returned from Afghanistan, they would say that the performance of the weapon was no better than it had been previously.

Adam Ingram: Extensive testing was carried out in the whole range of extreme weather conditionscold, hot and dusty. The weapon was tested not by politicians or civil servants, but by soldiers, in all those conditions. The hon. Gentleman may recollect the announcement at the conclusion of that extensive test programme and the launch of the SA80 A2. Evidence was adduced that showed the mean time in relation to failure of that rifle, which unquestionably showed a big improvement on what had occurred previously.
	Part of the analysis that is now taking place must, of course, take into account the maintenance regime. Are orders and advice properly given so that they are well understood, or are there factors that come into play that take the rifle into a more extreme environment than all the other testing environments? I am not in a position at this point in time to say what the conclusion is. I must wait for the expert advice before I can respond. I ask hon. Gentlemen, however, not to be quick to make judgments and decisions, and not to make them on the back of speaking to one or two service men or women. They should take balanced advice on this matter.
	I have set out the serious way in which we are dealing with this matter. I do not want any language to be usedobviously, hon. Gentlemen can use whatever language they wantthat could somehow put uncertainty in the minds of soldiers. They must use this rifle, which is a substantial improvement on that which they had before, which was already a very sophisticated weapon that had been purchased and designed for specific sets of circumstances. It was found to have faults, modifications were made, and we are now dealing with and trying to analyse the reports on the failures. Caution should be our watchword in dealing with these matters.
	I want to turn in more detail to the progress that we have made since the last procurement debate nearly two years ago in delivering some of the key projects that make up the defence equipment programme. Decisions taken during the strategic defence review have led to a broad range of powerful new equipment, some already in service with the armed forces and some in the pipeline to enhance our future capabilities.
	The House will be aware that we have embarked on the most extensive warship-building programme for a generation. On 2 July, I announced the findings of the RAND study into alternative procurement strategies for our future warship programme over the next 15 to 20 years and it dealt, in particular, with acquisition options for the Type 45 destroyer. The initial results from the study were used last year to help to inform our decision to proceed with a revised procurement strategy for that ship. To increase productivity and to retain the potential for future competition, we have decided that blocks or modules of each ship will be built by BAE Systems Marine and Vosper Thornycroft. Final assembly will be carried out by BAE Systems Marine. We now have a total of six Type 45s on contract, and they are due to enter service from 2007. All that demonstrates our clear commitment to a modern and powerful Royal Navy while guaranteeing work for UK industry and providing better value for money.
	The Royal Navy's ability to respond rapidly and flexibly to crises around the world will also be enhanced with the acquisition of the two next-generation aircraft carriers. Good progress is being made on their development. We expect to advise the potential prime contractors this autumn about the type of carrier design to take forward. We plan to announce the selection of our preferred prime contractor early in 2003, with the award of a build contract planned for early in 2004. The construction of the carriers will offer tremendous opportunities for UK shipyardsand I stress UK shipyards.
	An important element of that programme is the decision that I announced on 2 July that the future carriers will be base-ported at Portsmouth. As well as being good news for Portsmouth, that allows the relevant companies to construct their bids with that certainty in mind.
	Work continues on the new Astute class of attack submarine and on the replacement landing platform dock ships. Progress on these projects has been too slow, largely owing to a range of design and project management difficulties on the part of the contractor. That is very disappointing, but the Ministry of Defence is actively engaged with BAE Systems on all these projects to ensure that the vessels are brought into service as quickly as practicable. The company is in no doubt about our expectations.

Kevan Jones: I am very reassured by my hon. Friend's comment that the aircraft carriers will be built in the UK and will support UK shipyards. However, is he aware of what has recently occurred on Tyneside? Swan Hunter shipbuilders sub-contracted work on its alternative landing ship logistics to Dutch yards while the yards on Teesside and elsewhere remained empty. Work that could be done in this country is not being done here. Will he therefore assure me that work that is given to a prime contractor will not be sub-contracted to Dutch or other European yards?

Adam Ingram: We became aware of that development when my colleague in the other place was questioned by, and gave evidence to, the Scottish Affairs Committee. It was news to the Department, but it acted very quickly. It made clear to Swan Hunter our view of the build strategy. On the work that has been put out to tender, I understand that progress has been made to seek to have it done in the UK. However, we must recognise that there may be occasions when there is no capability for elements of a new build ship. It is not just a case of saying we have the skills base and the work should be done here. Sometimes sophisticated judgments have to be made and, when the work goes out to tender, European procurement rules may come into play.

Kevan Jones: I am grateful for that answer, but I raised the matter with the Ministry of Defence in a written question that I tabled last November. The Department assured me that it would keep a close eye on the sub- contracting work at Swan Hunter. Some sub-contractors in the region suspected in November that the problem would arise. If people in the north-east knew about it then, surely the Ministry should have known about it, too.

Adam Ingram: I do not understand the allegation. Is my hon. Friend saying that we have let down the north-east? If so, the opposite is true. I have given a commitment to UK shipyards which he should welcome. I said that the specifics relating to that section of the hull, which involved specialist steel cutting, were made known when evidence was given to the Select Committee. We acted immediately and the company was left in no doubt about its approach to procurement. Rather than being negative about what we are doing for UK shipbuilding, my hon. Friend should rejoice in the fact that we have given a tremendous commitment to UK shipyards. There is an old saying in Glasgow: it was tears that made the Clyde. It seems to me that the Ministry of Defence saved the Clyde, and that would probably be reflected in shipyard footprints throughout the UK.

Ian Davidson: As a Member who represents a Clydeside constituency, may I say how grateful we all are to the Minister and his colleagues for awarding the Type 45 and aircraft carrier contracts, which will require a tremendous amount of metal work, to our area? However, will he bear it in mind that competition and capacity for the future are also important, not only in terms of metal shaping, but in terms of the systems? The key to having future capacity to bid for major orders such as aircraft carriers will be the retention of a systems capacity. Given that one of the major bidders for the aircraft carrier is not British owned, is the Minister satisfied that if that company is awarded the status of prime contractor, the capacity for systems construction will remain in this country?

Adam Ingram: If my hon. Friend holds on, I will set out a review of industrial policy as it relates to procurement policy. However, he makes an interesting point. He claims that one bidder is not British, but if both bidders are non-UK owned, what would that mean for his argument? Will we be unable to place the order with the other company if it is taken over by a foreign competitor? We have to be clear that our drive and intention is to get such vessels built within UK shipyards where there is capacity to do so. However, we may get better value for money elsewhere in many cases that involve specialist equipment. The important consideration is not necessarily that we get British equipment, but that we get the best equipment.

Jim Knight: My right hon. Friend mentioned the decision on basing the aircraft carriers. I read his statement and letter to me with great care and was disappointed that the Department could not make the brave decision to return the basing of the aircraft carriers to Portland. I was interested to read his comments on a temporary berthing for the carrier. Is the Department thinking exclusively of Southampton for that role, or will it consider other prime locations on the south coast?

Adam Ingram: My hon. Friend, who always approaches such matters with great care and diligence, is right about his area not benefiting from that particular announcement. The announcement that applied to Southampton related to the unusual circumstances in which both aircraft carriers are in port at the same time. At some point in the future we will have to cater for those circumstances by providing additional berthing facilities. On the basis of an intensive study, I can say that Southampton offers the best facilities with the minimum investment. Depending on what facilities were provided, it could cost hundreds of millions of pounds to invest in a support berthing capability, and it might then never be used, so we have to exercise judgment in determining where to base ancillary support.
	My hon. Friend is very active both as a member of the Defence Committee and in representing his area, and I know that he will continue to raise these matters with me, but I hope that he understands the background to this decision.
	Before that exchange, I was commenting on specific matters relating to the aircraft carrier and the Astute class of submarine. I pointed out the delays to that programme and to the landing platform dock ship programme. It is worth repeating that the company is in no doubt as to our expectations for its performance on those ships.
	Although new warship platforms are important, we must be able to support them as part of our overall capability to deploy world wide. We need to determine the best way of supplying and replenishing the modern Navy, following the retirement of our ageing Royal Fleet Auxiliary support vessels. It is vital that we get those crucial capabilities right.
	Looking to the future, I can announce that we are establishing the military afloat reach and sustainability project teamor MARS, in MOD-speakat the Defence Procurement Agency in Abbey Wood to determine the best way to meet those needs. That could include more new build, new design ships, more flexible than our current single-role support shipping, faster, and able to adapt to a number of different roles. I expect to see the solution being phased in over the latter half of the decade. As a first step, industry will shortly be briefed on that. We will welcome innovative proposals, which might include public-private partnership arrangements. I hope for an imaginative and enthusiastic response from British industry. The spending review has given us the scope to launch that important renewal of these key capabilities.
	I have already set out where we are on the future aircraft carrier project. The aircraft selected as having the best potential to carry out strike, air defence and reconnaissance missions from the new carriers is the joint strike fighter. The JSF will be a supersonic aircraft, incorporating advanced stealth technology and capable of conducting multi-role operations from carriers and from land. It will be able to locate, monitor and attack targets with precision weapons while protecting itself from air or surface threats.
	The project will bring major benefits to UK companies, including BAE and Rolls-Royce, which could gain work valued at 3 billion during the current phase of the programme, and at 24 billion for downstream production and support activities. That could sustain or create some 3,500 jobs in UK companies, rising to 8,500 or more for production and support work.
	A detailed evaluation of the short take-off/vertical landing and carrier variant of the JSF is currently under way to establish which would best meet our needs. The House will, of course, be advised accordingly once we have reached a decision on that.
	The JSF will replace the capabilities offered by the joint force Harrier. The decision to withdraw the Sea Harrier earlier than previously planned reflects the age of that aircraftit is 20 years since the Falklands war. The major upgrade required to keep it viable would have been technically very risky and expensive, and the world has moved on. Our focus is now on expeditionary warfare, with carrier-based aircraft principally used for land attack operations. The Sea Harrier makes little contribution to that.
	We will instead significantly increase our land attack offensive capability by upgrading the Harrier GR7 to GR9 standard, enabling it to use smart and precision weapons. The recent Defence Committee report on major procurement projects acknowledged the rationale behind that decision, and will no doubt make a further contribution on that.

Mark Francois: Will the Minister give way?

Adam Ingram: I was expecting some response to this point, but may I just finish it?
	The Sea Harrier also lacks utility in countering the threat from sea-skimming missiles, whereas modern ship-borne systems have been designed for that purpose. I recognise that its drawdown removes a layer of air defence in the short termthere is no question about that. However, it is important to remember that there are other layers of defencefor example, Type 42 anti-air warfare destroyers armed with Sea Dart anti-aircraft missiles and Type 22 and 23 frigates with their point defence missile systems and close-in weapon systems.

Mark Francois: I am glad not to have disappointed the Minister, and thank him for giving way. Can he confirm that when JSF comes into service on the new carrier in 2012, part of its mission will be air defence, including the air defence of the fleet?

Adam Ingram: Part of it will be, but that is not its prime purpose. We have not walked away from or tried to hide the aspect of managed risk. It is interesting that the qualitative assessment in the Defence Committee's report recognised that it had been alleged that the decision was driven by a cost imperative and that it was about saving money. One of the Conservative Front-Bench spokesmen signed up to that report, so at least the official Opposition accepts that the decision was not driven by that, and that other factors come into play.

Mark Francois: I see that the Chairman of the Defence Committee is in his place, and no doubt he, too, will want to comment. I have read the Committee's report, and there is no way in which the Minister can spin it into an endorsement of the Government's decision. The Committee expressed reservations about it, and he should be accurate about that to the House.

Adam Ingram: I know that Opposition Members are told to use the word spin every time they speak to a Minister, so that eventually it will stick to us. There is no spin involvedit is an open explanation of the basis of the decision. The Committee acceptedor, to use a better word, acknowledgedthe rationale behind the decision. It may have doubts, but ultimately the decision rests with the Ministry of Defence, not the Committee, and we have to take responsibility for any misjudgments. We welcome all reports on the Department, but we have to balance our original decisions against any questions that arise.
	This was a sizeable, expensive, and indeed risky programme, and I have described the ingredients that had to come into play. The best advice came from those who were considering the issue of capability, not from civil servants and Ministers, who took advice on the military aspects. They asked two questions. Can the risk be managed? Is it the best way forward in terms of the spending profile both then and currently? The answer was yes.

Mike Hancock: Will the Minister be kind enough to explain the judgment that he made, given that his chief military adviser, Air Marshal Sir Jock Stirrup, said on 1 May in evidence to the Defence Committee:
	No, forgive me, but I made clear that if I could I would have preferred to have retained a viable Sea Harrier in service because we will be without one of the layers of air defence.
	The chief adviser to the Ministry of Defence and to the Minister was advising that he would have chosen to retain the Sea Harrier. What judgment did the Minister make in overruling that advice?

Adam Ingram: There was no overruling of that advice: it was part of the advice that we were given. One side of the equation was based on taking an approach that could have retained it, but that would have had certain consequences, including the risky element of upgrading the engine and issues relating to the management of resources. Military people would probably say, as now seems to be the case with the Liberals, Just give us everything that we ask for. Then they must step back and accept that we have to live in the real world. The advice was that there would be a reduction for a time in the layer of defences for any taskforce. [Interruption.] The hon. Member for Hereford (Mr. Keetch) should read all the evidence.
	We are upgrading the support mechanisms on the ships. The Type 45 destroyers provided even more capability and that led to the position that we subsequently adopted.

David Laws: rose

Adam Ingram: The world has moved on, and we are not fighting the war of 20 years ago. We are fighting in a completely new context and in coalition. That is a new way forward; it is what interoperability means.

Gerald Howarth: rose

Adam Ingram: I shall give way to the hon. Member for Yeovil (Mr. Laws) first. I assume that the hon. Member for Aldershot (Mr. Howarth) will repudiate our position. I shall be interested to find out.

David Laws: Does the Minister accept that he is replacing the technical risks in the upgrade project with actual military risks, which our forces will face without the Sea Harrier? Does he recall paragraph 93 of the Select Committee's recent report? It states:
	There are, then, a lot of pieces that must all fall into place before the Sea Harrier's demise can be regarded with at least some confidence.
	Is he not worried about that?

Adam Ingram: Of course, we have a measure of anxiety about the programme's delivery. I have set out a range of other decisions. After the short period that I mentioned, the new Type 45s will be in service and the other support mechanisms on existing ships will be upgraded. We will thus have the capability. Hon. Members will understand that the probability of a single Royal Navy taskforce going to sea is not high.
	International coalition of effort leads us to the conclusion that if we were deploying against a threat, we would have partners. [Interruption.] Where is the threat coming from? Perhaps the hon. Member for Yeovil can tell us the location of the new threat. Could the Sea Harriers tackle it? They cannot deal effectively with sea-skimming missiles. We have to equip ships to deal with them.
	There is risk management in everything that we do in defence. We have to balance resources and capabilities and the technical implications of an upgrade. Opposition Members do not appear to understand that there are risks in the technical aspects of the upgrade. They must resolve the conundrum, as we have done. That is why we made the decision.

Gerald Howarth: The Minister makes a great deal of the cost and technical difficulties of an upgrade of the Sea Harrier F/A2. He is right; I have spoken extensively to Rolls-Royce about the matter, and an upgrade would be expensive.

Adam Ingram: What about risk?

Gerald Howarth: There would be some risk attached to the technical fit of the engine. However, if an aircraft that was introduced into service as recently as 1999 is so deficient, why not scrap it and save the money now?

Adam Ingram: That is a ludicrous position. We have capability; the aircraft is not useless. However, it is not all-singing, all-dancing in the way in which Opposition Members appear to believe. As we move towards the expeditionary purpose, we need the capability to match. That is not compatible with Sea Harrier capabilities. Such judgments have to be made. Do we spend a lot of money, and risk not delivering the programme? The risk is not small. Indeed, we are considering a significant technical risk. The Sea Harrier is not designed to take the new engine. Conservative Members shake their heads. Have they got better advisers than the Ministry of Defence?

James Gray: Rolls-Royce.

Adam Ingram: Well, okay. Since Rolls-Royce is in my constituency, I suggest that the hon. Gentleman get the company to put that in writing and send it to me. Has Rolls-Royce put it in writing to the hon. Gentleman? I hear silence.

Paul Keetch: The Minister is a great student of history and will know that he is not the first Minister for the Armed Forces to say in the House that, effectively, we will never go to war by ourselves. Denis Healey said that in defence of the cancellation of CVA1; Sir John Nott said so in the 1980 defence review when he was planning to sell off HMS Invincible, which gave the wrong signal to the Argentines and led to the Falklands war, to which the Minister referred. If the Minister is saying that Britain will never need an air defence capability for the fleet again, why will the JSF have such an element? He cannot have it both ways. We either need an air defence capabilityin which case it should be continuedor we do not.

Adam Ingram: I do not think that I used the word never; I said probability and slim. We would all love the benefit of hindsight or to be able to project ourselves months or years before making such decisions in order to meet the unknown, but that is simply not possible. No Minister or Government have had that wisdom. It has been a long time since there has been a Liberal Government, and although I am an amateur student of history, I do not recollect their getting everything right.
	There must be a balanced judgment. We have made that judgment on the best advice and after considering all related elements. With the upgrade to the GR9 variant, we will have a tremendous force projection capability, which will enhance our strength and our ability to tackle what we believe on the probability of assessment to be the enemies of the future.
	The word never never appeared in my explanation. At some point, I will be able to rely on the fact that I never said that. I would be able to take some solace from that, although I hope that I shall never have to do so. The probability of assessment and the management of risk are undoubtedly right. We have had a useful and informative debate on that rumbling issue. I have again tried to educate from the Dispatch Box and to point Opposition Members towards the right decision, but we will see what happens as the debate develops.
	Operating alongside the JSF and complementing its capabilities will be Eurofighter. As my right hon. Friend the Prime Minister told the House on 10 July, there has been no change in the Government's commitment to Eurofighter. The aircraft will serve as the cornerstone of the RAF's fighting capability from the second half of this decade. It will be a state of the art fighter aircraft with a formidable weapons suite, including the advanced short-range air-to-air missile, Meteor, Storm Shadow and Brimstone, and provide a true, adverse-weather, multi-role capability.
	The programme remains important not only to the RAF but to the UK's defence industry and those working in it. The UK has made a contractual commitment to purchase 55 Eurofighter aircraft in the first of three envisaged production tranches. A memorandum of understanding with the partner nations covers the first tranche, and the balance of 232 aircraft to be purchased in two further tranches89 in tranche 2 and 88 in tranche 3.

James Gray: The Minister referred to the Prime Minister committing himself to the Eurofighter as is. Can we be plain about this? Is the Minister giving an undertaking that the Government will definitely purchase 232 airframesand if so, how do they intend to pay for them?

Adam Ingram: That is predicated on Labour remaining in power; I am grateful to the hon. Gentleman for conceding that. His point is not silly. Clearly, we can make commitments only from where we stand at this point. Under most circumstances, it has never been possible for Governments to commit future Governmentscertainly not those of a different hue.
	I have set out our commitment in the memorandum of understanding, and there are many commitments associated with that. There will be a tremendous payback in UK industry terms; all those benefits will flow from this. I have set out the three tranches of purchasing, and the Prime Minister made all this clear on 10 July. Who am I to say anything different? I welcome his statement because it is consistent with what we have been saying all along.

James Gray: Perhaps I can clarify the position. When the Conservatives return to power in three or four years' time, we shall be firmly committed to purchasing all 232 Eurofighter aircraft. Will the Government now match that commitment?

Adam Ingram: Well, okay, let us match commitments. Let us go down the list. When I get to the end of my speech, I would like the hon. Gentleman to say that he will stand by every one of our commitments[Interruption.] I have given the assurance, as has the Prime Minister. I do not think that that is at variance with what the hon. Gentleman has said on this. The words stand, and they are very clear. That commitment remains the same, and I have set out the tranche purchasing approach on this.
	I mentioned the Meteor beyond visual range air-to-air missile. Good progress has been made on resolving complex technical and commercial issues, and a draft contract has been circulated to partners. The UK and partner nations remain committed to the project, but the contract is unlikely to be signed before the summer. The project still needs to gain the necessary approvals in the German system. The next opportunity for the Bundestag committees to discuss Meteorand indeed A400Mwill be in September. I very much hope that they will grasp this opportunity. Officials are discussing with partners and industry the implications of a delay until September. This delay is disappointing, but we continue to do all that we can to place the contract as soon as possible. As I have just said, the same time frame applies to decisions on A400M. We are working hard to ensure that this contract can also come into effect.
	Having dealt with specific sea and air capabilities, let me now highlight three particular capability achievements that contribute directly to our forces' ability to deploy, engage and win on the battlefield. The first is the delivery of the Westland Apache attack helicopter, which entered service in January last year. The arrival of Apache illustrates how we are meeting our strategic defence review commitment to deliver world-class, highly capable equipment to the armed forces, which will help to transform the battlefield. [Interruption.] I think that the hon. Member for Hereford and I are on side on this one.
	The second achievement involves the Maverick anti-armour missile, which entered service with the RAF in February 2001. Lessons learned from operations in Kosovo identified the need for improvements to our capability to attack armoured targets with precision and speed. We have acted quickly to fill that gap. Thirdly, I want to highlight the delivery of the Viking all-terrain vehicle platform to the Royal Marines, which has proved a great success. Looking forward to future equipment capabilities, the MOD has signed several key contracts, including that for the delivery of a heavy equipment transporter service, and one for the next generation light anti-armour weapon.
	I am also pleased to inform the House that the Ministry of Defence has today announced its intention, subject to the satisfactory conclusion of final contract negotiations, to award a contract worth some 350 million to RO Defence for the demonstration, manufacture and support of 65 Terrier armoured engineer vehicles. Terrier will replace the in-service combat engineer tractor, enabling the British Army to retain and enhance a vital operational capability provided by the Royal Engineers. This new order is very welcome news for the company and for Alvis, which will have a significant role in manufacturing the vehicles. I am sure that the management and work force at both locations will be delighted with this news.
	I have already mentioned that the development of a network-centric capability will transform the way in which the United Kingdom's armed forces are able to operate. This forms a key part of the work that we have been undertaking on the new chapter to the strategic defence review. This is not just an aspiration; things are happening now to deliver the reality, providing an essential foundation on which the new chapter will build.
	The need for reliable, global military communications has been demonstrated in all recent conflicts, but especially in Afghanistan. The Skynet 5 satellite programme will ensure that we continue to have this important capability. We announced the Paradigm consortium as the preferred bidder in February and, subject to successful negotiation, we expect to place a private finance initiative contract by the end of the year.
	Over the coming years, we will see great improvements in our ability to communicate, and to exchange information securely wherever we operate. A number of complementary systems will ensure that we continue to have effective command and control, whether operating independently or with our allies. Bowman will provide a secure communication and data transfer system, as well as the basis for the wider digitisation of land operations. We expect it to enter service in 2004.
	We recognised the early need to improve communications, and we have introduced the personal role radio, which has proved extremely useful in Afghanistan. I can announce today that BAE Systems, in Christchurch, and Marconi Mobile, in Chelmsford, have been chosen as preferred bidders for the assessment phase of the first stage of the Falcon programme, which will provide a communication system at formation level. These two British companies have been chosen to enter the final stage of the competition for the armed forces' new, 430 million secure communication system. Successful communications are the key to success on the battlefield, and to our ability to deliver precision weapons rapidly and accuratelywhat we are calling network- centric capability.
	Falcon's role in drawing this together, and connecting systems such as Skynet and Bowman, is key, giving senior commanders the ability to direct operations effectively on the battlefields of the future. Falcon will be able to carry a greater volume of voice and data traffic more effectively than existing equipment. It can be deployed on or off-vehicle, and moved rapidly by air into the operational theatre. It will also need less manpower to operate and to support.
	Finally, Cormorant will provide a state-of-the-art, theatre-wide area communications network, and will enter service shortly.

Hugh Robertson: On talking to anybody involved in recent armed forces operations, it is clear that the key word is inter-operabilitythe ability to operate not only within our services, but with service men from other countries. Can the Minister guarantee today that, as the new equipment programmes come on-stream, they will be tested to ensure that they are fully inter-operable with American systems, given that, these days, we spend much more time operating with the Americans and, indeed, with our continental allies? Surely that is a key part of the programme.

Adam Ingram: That is a very important point. Although inter-operability has been a watchword for some time, it has become the key approach in terms not only of our enhanced capabilities, but of how we encourage our European allies and aspirant NATO nations to improve their capabilities as well. We have very good relations with the United States, and if that interface is genuinely to deliver what we want in respect of NATO or any other partnership between allied nations, we must ensure that such inter-operability and compatibility exists. Otherwise, certain procurement decisions, such as those made by previous Governments, could well have to be scrapped.
	On the projects that I have just outlined, performance in many key capability areas has been, and continues to be, impressive. However, in certain areas the rate of progress has been disappointing. Let me make it clear that, when contractors are unable to deliver equipment to agreed time frames, we do not just sit back in resignation. We are getting much smarter at dealing with the consequences of slippage.
	The overall rate of slippage has reduced, as has the number of projects experiencing delay. New slippage during 2001some 29 months across four projectswas less than half that in 2000. We are also much better at working with contractors to ensure that we get a useful capability into service at the earliest possible date, building on that initial operating capability through incremental acquisition to reach the full levels of required performance. Our approach to acceptance of the ASRAAM missile is a good example of this smart behaviour. The Ministry of Defence has taken delivery of a first batch of interim standard missiles, which offer a significant improvement over existing capability.
	The Public Accounts Committee's recent report, Ministry of Defence: Major Projects Report 2001, provides further evidence that the Department is continuing to improve cost control, that we have slowed the rate of slippage on projects, and that new equipment continues to meet the vast majority of specified technical requirements. According to the Committee:
	The Major Projects Report for 2001 shows encouraging signs that the Department's performance is improving under Smart Acquisition.
	In an earlier report, published on 23 November 2001, the NAO welcomed
	the signs that the Ministry of Defence is beginning to bring delays on major projects under control, and is continuing to control costs on major projects and to meet the vast majority of the technical requirements of the Armed Services.
	We will respond formally to the PAC reportand to the Defence Committee's survey of major procurement projectsin the early autumn. It would be wrong to reply before the formal response process. [Interruption.] The Opposition complain that I have now been speaking for an hour, but I have tried to take all the interventions that would add value to the debate. We have an extensive debate on a key issue. [Interruption.] I am conscious that representation is sparse on the Benches behind the Opposition Whip

David Wilshire: And behind you.

Adam Ingram: We are comfortable with our solution, but it is the Opposition's job to try to knock us down. I do not need a lot of allies behind me, although I welcome every contribution that will be made.
	Smart acquisition is not just about buying new equipment; it is also about how we manage the equipment we own to maximise the capability available to front-line forces in a cost-effective manner. That means looking not only at how we acquire the equipment in the first place, but at how we support equipment through its in-service life and how we undertake its disposal.
	Being smarter in how we support equipment falls to the Defence Logistics Organisation, which as part of its drive to reduce costs and improve effectiveness is reviewing stock holdings and using innovative techniques to identify further reductions.

Mike Hancock: Will the Minister give way?

Adam Ingram: Well, I hope that I will not get into trouble with Opposition Front Benchers for extending the debate.

Mike Hancock: I congratulate the Minister on the robust way in which he has defended his position and thank him for his generosity in taking interventions. I sense that the Minister is easing to a conclusion, but before he does can he tell the House whether he is satisfied that the procurement that will be required under the new chapter can be achieved within the new money that has been allocated to the Ministry, or will some of the existing procurement schemesthose in the planning or development stagebe cut?

Adam Ingram: I am grateful to the hon. Gentleman for his intervention, but he must not have heard my earlier remarks. I said that a White Paper will be published tomorrow and the Secretary of State will then elaborate on its contents. I have pointed out the 1 billion of new capital investment and the 500 million of other money, but I suggest that the hon. Gentleman seek to explore his specific questions after the White Paper is published.
	The Defence Logistic Organisation's non-project procurement office was set up on 1 April 2000 to manage general stores and has already generated significant savings. In its first year of operations, it rationalised the supplier base, making savings of some 40 million on new contracts valued at 350 million. Other partnering agreements with industry are helping the Department to manage its stocks more effectively, transferring stock-holding activities and risks to contractors. [Interruption.] I have a couple more points to make. We have had a good debate so far, and I look forward to further contributions.
	Another important plank of our overall smart acquisition programme has been the drive to extend its benefitspreviously confined mainly to the equipment programmemore vigorously into the acquisition of services, especially through private finance and new commercial partnering arrangements. Our public-private partnership and private finance initiative programmes continue to have an important role to play in making best use of defence resources and delivering improved services. We have the richest, most diverse and one of the most successful PFI programmes in Whitehall. PFI has enabled us to obtain new aircrew training simulators and other equipment-based services, but such schemes could go much further and that is the approach that we are taking.
	The last issue that I wish to address is industrial policy and I see that my hon. Friend the Member for North Durham (Mr. Jones) who intervened earlier on that point is still in his place. I am happy to exchange views with him if he has any further thoughts on the issue. All of the issues that I have set out are important in their own right, but clearly they have an impact on industry generally. The United Kingdom benefits from a strong and innovative defence industry that contributes to our overall economic wealth, science and technology base, andimportantlyto regional economies.
	Competition remains the bedrock of our acquisition policywhen sensibly applied it consistently gives the taxpayer value for money. Competition works to encourage innovation. As our procurement requirements change, innovation will increasingly be the key to winning many contracts, something that I hope will benefit many of our smaller and medium-sized firms. Competition should be seen not as a threat but as an opportunity.
	I would not suggest, however, that there is a single standard approach to that opportunity. We will use alternative procurement routes, such as partnering, where industry and Government can benefit from stable long-term relationships. Suggestions from some parts of industry that we should look only to privileged or monopoly suppliers are shortsighted: to do so would stifle innovation and we would end up paying inflated prices for probably inferior equipment.
	Let there be no doubt. We want to buy the best. We want to buy British. So we must constantly look for ways to help British industry to be the best, but industry has to play its part. My Department's first responsibility is to spend the defence pound to achieve best value for money. That applies more widely than simply purchasing equipment. It has broadened from equipment acquisition to the purchase of services, and many defence companies now cross national borders. It is where the technology is created that is important and that means looking to see where the skills and the intellectual property reside, where the investment is made, and where the jobs are sustained and created.
	We also support the UK defence industry with our efforts to improve access to foreign markets and through our research and technology strategy. Increased access to foreign defence markets will improve technology transfer across national boundaries and increase the opportunities for our companies to compete for export orders. That is important: UK defence companies cannot rely on MOD orders alone to keep them in business. That is not the MOD's job.

James Arbuthnot: Is the Minister aware that there should be much support for the Government's decision on head-up displays being sold on US aircraft? If we were to withdraw the right for manufactured equipment from this country to be sold abroad by our allies, we would never be able to enter partnership agreements for valuable equipment that will win markets all around the world.

Adam Ingram: I agree entirely, and that has certainly been the Government's view in the case to which the right hon. Gentleman refers.

Jim Knight: My right hon. Friend mentioned research and development. Does he agree that having a geographical concentration of expertise, especially in research and development, is a good thing? In my area, we have expertise in sea systems technology, two QinetiQ operations that are based in the area, and many other private sector operations. However, the Defence Science and Technology Laboratory proposes to remove its discrete sea systems expertise and place it elsewhere

Madam Deputy Speaker: Order. Will the hon. Gentleman now bring his intervention to a close?

Jim Knight: Certainly, Madam Deputy Speaker. I would be grateful for my right hon. Friend's comments.

Adam Ingram: The concentration of science and technology cannot be a good thing, because we want to see a spread over the UK. However, industry has to stand by the decisions that it takes. We cannot second-guess companies or force them to do something else. However, we can encourage them and discuss the Government's future relationships with them. I have tried to set out what the Government can do, what we expect of industry and the possibilities for a partnership approach. That does not rest just with the MOD: it applies across Government delivery.

Gerald Howarth: Will the Minister give way?

Adam Ingram: The hon. Gentleman must have been given leeway by his Whip to intervene. Only a few moments ago, the Opposition were complaining that I was speaking for too long.

Gerald Howarth: I regard the Minister as an extremely courteous man, and, along with others today, I am very grateful to him for giving way.
	The point made by the hon. Member for South Dorset (Jim Knight) is important, and it has come to light only in the last week. I had a letter from the Under-Secretary of State about the concentration of DSTL employees on three sites. The point made by the hon. Gentleman relates not to company decisions, but to a decision by the Government. I suspect that it is a very good point. Can the Ministeror perhaps the Under-Secretary of State when he winds up the debateexplain the rationale behind that concentration?

Adam Ingram: As the hon. Gentleman says, the decision rests outside the Department, but my hon. Friend the Under-Secretary of State may explain the rationale later. Let me, however, say something about the near-company status conferred by some of our activities. Trading funds are one example. We must operate on the basis of best principle rather than mere dissemination for the sake of it. Quality decisions must be made to secure the maximum return on investment. We are no different from industry in that respect. As I have said, we expect a great deal from industry. We must deliver a great deal in return, and we must find solutions. Emotive decision-making is not the best way of delivering on any Government policy, but that applies particularly to the Ministry of Defence.

Ian Davidson: The Minister urged me earlier to await his utterances on industrial policy. I did so, but they were a trifle too delphic for me. In other words, I did'nae understand them completely.
	I did of course understand what the Minister said about the merits of competition, and about the advantages of partnership and the disadvantages of monopoly supply. Perhaps, though, I can take him into the fourth dimension. Many of these matters cannot be seen in isolation here and now, because some of the decisions we make here and now have implications for our future capacity to tender for orders. What is the Government's industrial policy in relation to, in particular, the aircraft carrier, in the context of retaining intellectual property associated with systems design in this country so that we can bid for future orders?

Adam Ingram: I am sorry if I was delphic. I did not intend to be. I thought I was being very clear about what we require from industry, what we will not accept from industrywhich my hon. Friend now acceptsand how we can move forward together.
	I spent some time talking about shipbuilding capacity. The MOD alone cannot save the shipbuilding industry. We can do a lot, but the industry must be much more forward-looking and much more commercially intensive. It must look for the opportunities that are out there so that it can spread its workload to secure the broad capacity and skills base that we need.
	We must seek at all times to purchase the best possible equipment for our front line. That means that we cannot be a patsy to Government. There is no longer any sacred cow. It cannot be thought that we will roll over and accept things because of political pressure from one quarter or another.
	I know that my hon. Friend engages with the company in his constituency. No doubt he will make its members aware of what is being said now, and has been said consistently, by defence Ministers, if they are not already aware of it. We want a lot from industry, and we are prepared to give a lot, but industry must produce the best equipment, and it must produce it at a good price. That must be the core of our approach.
	Overall, I consider that we have the right resources, the right industrial policies, the right approach to smart acquisition, and a wide range of impressive equipment projects to help ensure that our armed forces have the capabilities that they need in order to deal with the complex challenges of the future. We ask a lot from the men and women in our armed forces, and they have the right to expect the best from us in return. That is this Government's objective, and I think we are on course to achieve it.

Gerald Howarth: I think the Minister has received general acclamation for what must be described as a marathon. He entered into the spirit that the House wanted by giving way and engaging in debatea debate that will continue this evening.
	This is a timely debate, occurring as it does on the eve of the Farnborough air show in my constituency. I hope the Minister and others will go to that: it is the greatest air show in the world, and the greatest showcase for an important component of British manufacturing industry. I am bound to add that it might have been better to hold the debate after the publication of the new chapter tomorrow, when we could have had the benefit of seeing it. No doubt its publication will give us another opportunity to question the Minister. I hope he will ensure that we have a proper debate about the new chapter.
	I too pay tribute to the United Kingdom's defence industry. Notwithstanding the occasional criticism, British industry delivers some first-class equipment to Her Majesty's forces. It gives employment to 345,000 people throughout the United Kingdom, and contributes significantly to our national prosperity. The British aerospace industry alone has earned the United Kingdom 100,000 million in exports in the past 10 years, with defence exports playing their part.
	The Minister made an important point when he said that British companies must look overseas to ensure that they are not wholly dependent on the United Kingdom defence market. That means, however, that those companies must have the support of the British Government and of Parliament for their efforts to provide defence equipment to defend our allies overseas.
	I welcome the Minister's announcement about the Terrier, and the 350 million order for Royal Ordnance. We are talking about a British company and a British order for the benefit of some first-class British Royal Engineers. I am particularly pleased because the Royal Engineers have a major base at Gibraltar barracks in my constituency, and I think they have demonstrated that when others are on exercise they are doing it for real. Exercise Saif Sareea proved that last November.
	As we expected, the Minister made much of the Chancellor's financial largessealthough delivery of the largesse announced on Monday is not scheduled to start for nine months. Before the Minister gets too excited, let us examine the figures. On Monday the Chancellor told us that defence spending would increase by 3.5 billion over the next three years from today's base of 29.3 billion; but, as my hon. Friend the Member for North Wiltshire (Mr. Gray) implied, that figure refers to the new resource accounting standards recently introduced in all Departments, to which we shall all have to become accustomed.
	On the old cash accounting basis, this year's figure would be 24.2 billion. Under that convention, and allowing for annual inflation of 2.5 per cent., the increase in spending over the next three years will amount to just 1.2 billionabout 400 million a year. Even on the Government's figures, there will only be a 1.2 per cent. real annual increase.
	The Minister trumpeted the marvellous settlement that his Department had secured. I do not want to be too churlish, but I think it only fair to point out that his 1.2 per cent. compares with a three times greater increase for the Department for Culture, Media and Sport, which received 3.5 per cent. for each of the next three years. Some may of course regard sport as an extension of war, but I am afraid the fact remains that the Minister's Department did not do quite as well, in comparison with other Departments, as he tried to pretend to the House.

Kevan Jones: The Tory Government cut the defence budget by one third, although I accept that times were different then. It is interesting to hear the hon. Gentleman go through the figures, but can he give a commitment that a future Conservative Government would at least match the increase that has been announced? If not, will he say what increase such a Government would provide?

Gerald Howarth: That was a good try by the hon. Gentleman, who anticipates part of my speech. I had expected that he would ask that question, and he may rest assured that I will come back to it.
	As a percentage of gross domestic producta yardstick constantly applied to NATO applicant statesUK defence spending will fall to a post-1979 low of 2.2 per cent. That compares with 2.9 per cent. of GDP when the Conservative Government left office in 1997.
	When the threat was high and real, as in 198283, the then Conservative Government found the resources to match it, and spending rose by 6.6 per cent. in that period. Even when that Government cut defence expenditure after the fall of the Berlin wallI am sure the hon. Member for North Durham (Mr. Jones) is old enough to remember that there was a great clamour then for a peace dividendI do not recall that any member of the then Opposition said that the cuts were too great.

Bruce George: rose

Gerald Howarth: All the argument was the other wayexcept, I suspect, from the right hon. Gentleman who is about to intervene.

Bruce George: I am grateful to the hon. Gentleman. I hope that his highfalutin statistics were not the ones provided for him by the Defence Committee this morning, or we would get very angry. Does he accept that much of the increase in defence expenditure after the Falklands war was used to replace the ships that were sunk, of which there were too many? Also, in 1985 the Conservative Government broke the commitment given by Fred Mulley in response to a NATO request that the UK, like all NATO members, would increase defence expenditure by 3 per cent. in real terms. The decline in defence expenditure began in 1985, well into the cold war. I hope that the hon. Gentleman will look again at his brief, and be more careful. It is true that the Conservative Government left office with defence expenditure of around 2.8 or 2.9 per cent. of GDP, but it was 5.3 per cent. when

Mr. Deputy Speaker: Order. The right hon. Gentleman is a very experienced Member of this House, and he must know that his remarks have gone well beyond the bounds of an intervention.

Gerald Howarth: I can safely conclude that, whichever party was in government, its defence expenditure would not be sufficient for the right hon. Gentleman, who has long been a stalwart supporter of defence expenditure.
	The figures that I have came from the House of Commons Library, not the Defence Committee or the Government. The right hon. Member for Walsall, South (Mr. George) is right that there was subsequently a reduction in expenditure, but in the years 198283, 198384 and 198485 there were increases of 6.6 per cent., 2.9 per cent. and 5.3 per cent. respectively. That shows that there were substantial increases, not just post-Falklands, but at a time when the UK faced a threat.
	As I said, I doubt whether any Opposition Member at the time said that the then Conservative Government were cutting defence expenditure too much. Indeed, when I was resting between engagements in the period 199297, one Labour Member whose name I shall not reveal told me that a Labour Government on taking power would not have to worry about making cuts, as the Tories would have done all that for them.
	Does the Minister of State wish to intervene?

Adam Ingram: No.

Gerald Howarth: Fine.
	I do not want to be churlish about the increase in defence expenditure. I assure the House that the Opposition welcome itunlike the Labour Opposition in the 1980s, who rejected the Conservative Government's increase in defence expenditure. Given the range of military commitments that the Government have entered into, it was imperative that real increases were made.
	Everyonefrom previous Chief of the Defence Staff Lord Guthrie to Back-Bench Labour Membershas called for an increase in defence expenditure, but that has to be viewed in the perspective of the massive increase made in the US. This year alone, expenditure there has risen by $48 billion, as many hon. Members will know. The expenditure gap between European nations such as Britain and the US is widening. We understand that we cannot match US expenditure, so I shall say no more on the point, other than that we welcome the increase that has been announced.
	I can tell the hon. Member for North Durham that the Opposition position on spending was made clear by my hon. Friend the Member for North Essex (Mr. Jenkin), the shadow Secretary of State for Defence, at the Royal United Services Institute meeting last week. He said:
	It is still three years before the likely date of the next general election. We shall only be able to decide on the proper level of defence spending after consultation in Government with the Chiefs of Staff and our allies. We will fully fund the defence capabilities that are essential to safeguard national security and to fulfil our international obligations.
	I suggest that that is a stronger commitment than any given by any Opposition in the post-war period. It is a very strong commitment and reflects the priority that the Conservative party accords to defence under the leadership of my right hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith).

Kevan Jones: I am very grateful to the hon. Gentleman for giving way again. The statement that he has just made may have been all-encompassing but as an explanation it was as clear as mud. If we are to enter into the expenditure that the Opposition clearly want, what other services such as education or health does the hon Member for Aldershot (Mr. Howarth) think we should cut? Or does he think that the Government have an endless, elastic budget that fits all demands?

Gerald Howarth: I am sorry that the hon. Gentleman, whom I happen to like, should choose to digress down the route of expenditure on other things. This debate is about defence, on which I have set out the Opposition's position. I have heard the hon. Gentleman question visitors to the Defence Committee, and I know that he often says that their perfectly clear assertions are as clear as mud. So I do not consider that his remark amounts to a serious criticism of my explanation of the position taken by my hon. Friend the Member for North Essex, the shadow Secretary of State.
	It is the Opposition's duty to hold the Government to account over their strategic defence review commitments. This is not a game: we have a duty to question the Government and to ensure that they are doing the right thing.
	If the Chancellor's settlement is as generous as the Minister of State suggested, why did he not say that recent cuts would be restored? What about returning 5 Squadron Royal Air Force Tornadoes from mothballs? What about reinstating the three cancelled Nimrod MRA4s? What about engaging the 5,600 recruits needed to bring Britain's smallest Army since the time of Wellington to the Government's own target strength, and to restore the Territorial Army to its Tory strength of 59,000? Why do not the Government reverse their decision to scrap the Royal Navy's fleet protection force of Sea Harriers, which they said they could not afford to keep after 2004? Of that we heard nothing in the Minister's speech.

Adam Ingram: I talked about Sea Harriers.

Gerald Howarth: The Minister did talk about Sea Harriers, but he said nothing about the cuts that we were told had to be made to save money. We did not hear that those Sea Harriers were to be restored as a result of what the Government call the substantial increase in defence expenditure accorded by the Chancellor.
	What provision have the Government made for the cost of putting a division of up to 25,000 men into full battle order? The Secretary of State told us on Monday that
	absolutely no decisions have been taken by the British Government in relation to operations in Iraq.[Official Report, 15 July 2002; Vol. 389, c. 10.]
	The right hon. Gentleman was right to make that clear. Yet the Prime Minister also made it clear in his cosy fireside chat yesterday that military action might be required because the threat posed by Iraq's weapons programme was growing, not diminishing. Either sensible and prudent preparations are now being made or our armed forces risk being called into action with inadequate preparation. Which is it? The Minister must answer that when he comes to the Dispatch Boxunless he would like to answer now, in which case I will give way.

Lewis Moonie: Carry on.

Gerald Howarth: That says it all. There is a big hole in the Government's strategy on the issue.

John Smith: Surely the hon. Gentleman appreciates that force planning and preparations for various scenarios take place all the time. It would not be appropriate for a Minister to declare what planning is currently taking place inside our armed forces should we enter into military action, when the enemy would like to know what the hon. Gentleman wants to know.

Gerald Howarth: Of course the House should not be informed of every detail, but there is a policy issue here. If an operation is mounted, there will be a cost attributable thereto, and it is right for us to ask whether Ministers are putting that into their budget and making the necessary provisions.

Adam Ingram: Am I right in assuming that the hon. Gentleman is asking about commitments to any future deployment and the costs associated with that, not just about a specific deployment?

Gerald Howarth: indicated dissent

Adam Ingram: I see that the hon. Gentleman is asking only about the specific. Whether specific or general, when the unplanned-for demand comes, the cost is then met, as happened under previous Governments. If the hon. Gentleman looks at the budget outturns on which he claims to be an expert, he will realise that the commitments that we have had to meet recently in Macedonia, Sierra Leone and, more important, in large-scale terms, Afghanistan, have all been met. I hope that the hon. Gentleman is not asserting that we do not do that.

Gerald Howarth: No, I was not asserting that. I do not regard myself as an expert, but the House of Commons Library is reasonably expert in these matters, and I do not think that the Minister of State should query its integrity.
	The point that I am making is clear: the Secretary of State said that absolutely no decisions have been made, but the Prime Minister is making it clear that there is a prospect of the Government undertaking some kind of operation. As yet, no decisions have been made, and we understand that. However, I repeat that either sensible and prudent preparations are being made or our armed forces risk being called into action without proper preparation.

Adam Ingram: So that there is no doubt in the hon. Gentleman's mind, will he take it from me that all operational costs are met from contingency funds and not from planned expenditure? Does he understand that part of the process? To ask that is to call into question not anyone's analysis but the hon. Gentleman's capability of understanding the complexity of these issues.

Gerald Howarth: Of course not all expenditure comes from the contingency fund. Some will inevitably come from the Ministry of Defence, and we have not yet seen the full accounts relating to Afghanistan.
	I should like to press the Minister on the SA80 rifle, which is causing so much concern. The SA80 would be the standard infantry weapon in any major ground operation in the middle east or elsewhere. I am not sure whether the House properly noted the point made by my hon. Friend the shadow Secretary of State for Defence on Monday, when he asked the Secretary of State to confirm that in a test of the weapon in Afghanistan, out of 30 rifles firing 90 rounds each, 20 jammed. We are pleased that the tests to which the Minister of State referred took place, but the House needs to know the outcome. We entirely accept that the right hon. Gentleman has not yet received the report, but the House is entitled to know the outcome of those tests and his response to the report. If the report fails to give the SA80 a clean bill of health, are the Government prepared to replace that weapon altogether, as the hon. Member for Hereford (Mr. Keetch), who is no longer in his place, asked? Can the Under-Secretary confirm that comparative tests are under way in Bagram, involving the SA80 and other comparable weapons such as the M16which, incidentally, is the standard weapon for the United States army, and the weapon of choice for certain key elements of the British Army?
	On some of the major procurement programmes, we welcome many of the projects under way. The Minister of State referred to the two substantial new 50,000 tonne aircraft carriers, which will provide the United Kingdom with a vital independent capability to launch operations without recourse to land bases. However, the project is inextricably bound up with the new joint strike fighter being built by Lockheed Martin and BAE Systems. The JSF, with its offensive and air defence capability, will be the vessels' essential partners. My hon. Friend the Member for Rayleigh (Mr. Francois) was right to point out that the JSF is not simply an offensive weapon with an air-to-ground capability but has an air defence capability. That is an important factor. However, the project is not yet assured, nor can anyone at this stage of the aircraft's development programme be entirely confident of an in-service target date of 2012 being met. The House will want to know exactly how the Government see the timetable for these two linked programmes working out. The two carriers and the joint strike fighter must both come on stream at the same time, which is quite a risk. We wish the Government well and hope that the projects will be achieved on time and together.
	I hope that the Minister of State will be able to tell us soon when we can expect a decision on the joint strike fighter type to be procured. He said that he was not in a position to make a decision yet, but it is important to the whole design concept of the aircraft carrier whether the aircraft to be deployed from that carrier will be a short take-off vertical landing aircraftSTOVLor whether it will be the carrier variant, which will be a steam catapult-launched variant. The design of the aircraft carrier depends on that decision. My personal preference, to which I know the Minister will attach enormous weight, is to find in favour of the STOVL variant rather than the catapult-launched carrier variant, as I believe that the STOVL variant will provide versatility as well as maintaining Britain's lead in this very important field of technology. There is an added advantage in that pilots operating off aircraft carriers using a STOVL aircraft need a lot less training than pilots on a catapult-launched system, which I am told takes up to six months to convert from a STOVL aircraft.
	We have discussed the Sea Harrier already, but I wish to say a little more. With the F/A2 Sea Harrier being withdrawn from 2004, our existing carriers will be without an outer layer of air defence cover, as the Minister of State acknowledged. In our view, that will severely limit the UK's ability to deploy an expeditionary force.
	Indeed, as Air Marshal Sir Jock Stirrup, Deputy Chief of the Defence Staff, Equipment Capability, told the Defence Committee on 1 May, official thinking was that
	we envisage in most cases high intensity combat operations being with allies and partners.
	That is entirely consistent with what the Minister said, but it means that we shall not have that independent capability should the need arise.
	We hope that the need will not arise, but it may. My remarks are slightly tongue in cheek, but currently there are arguments relating to Gibraltar and we have just seen Spain reclaim an island that the Moroccans had claimed[Interruption.] I am not suggesting that Spain is about to invade Gibraltar, and the Minister need not assume that I am. However, the important point is that no one predicted the Falklands. Being prepared for the unexpected is one of the key duties of the Government.
	In a reply to my hon. Friend the Member for North Essex, the Government conceded that although they anticipate that they will not have to operate other than with the support of allies and partners, no consultations have taken place with allies and partners who could provide air defence cover. We are talking principally about the United States. The policy was not as well thought through as the Government suggested.

Kevan Jones: May I try to extract a commitment from the hon. Gentleman? The Conservative party's approach to defence expenditure seems to rely on an elastic cheque book. If we were in the nightmare situation that there was a Tory Government, would they take a gamble with money and technology and actually upgrade the Sea Harrier?

Gerald Howarth: There is no technical gamble in operating the Sea Harrier at present. As we speak, the Sea Harrier is on duty with Her Majesty's forces, performing the role for which it was designedto defend the fleet and act as an interceptor. The aircraft is doing that at the moment, so there is no technical gamble to take.
	The Government should acknowledge that the Select Committee, by consensus, was unhappy with their decision to scrap the Sea Harrier. Even Sir Jock conceded:
	It is not . . . something that I would have chosen to do were it not for the fact that we have to make some hard choices in terms of balance of investment.
	The hon. Member for Portsmouth, South (Mr. Hancock) also referred to that point. In effect, Sir Jock was sayinghe made no secret of itIf we had the money, we'd like to keep the Sea Harriers. I have heard that from even higher authorities.

Mike Hancock: Will the hon. Gentleman tell the House whether he still shares my opinion that no sustainable argument was made by anyone who gave evidence to the Committee for the early phasing out of the Sea Harrier? The life of the aircraft could be extended until the gap could be fully covered by the Type 45 and the upgraded equipment on the Type 42.

Gerald Howarth: The hon. Gentleman is right. If the joint strike fighter is to have its air defence capability, it is conceded that that would be valuable for a maritime expeditionary force, but that is what will be removed.
	The Government are relying on the Type 45 destroyer with its improved phased-array radar and new principal anti-air missile system to make up some of the air defence capability lost with the demise of the Sea Harrier. However, the first Type 45 is not due in service until at least 2007as the Minister acknowledgedbut we do not know whether that target in-service date will be achieved. Even that is a full 18 months after the last Sea Harrier will have disappearedassuming that the programme will be on time and that its weapons system meets the specification.
	Will the Minister confirm the Defence Procurement Agency's statement that the ship will have a potential ballistic missile defence capability, using the Sampson radar? In a written answer to my hon. Friend the Member for North Wiltshire, the Under-Secretary of State for Defence denied that any Ministry of Defence studies had been made to assess the specific suitability of the Type 45 for a ballistic missile defence role. He also acknowledged:
	As the design of the type 45 progresses, opportunities to upgrade the ship's capability are being identified and acted upon.[Official Report, 16 July 2002; Vol. 389, c. 158W.]
	Will the Minister tell us what those opportunities are and whether studies will be carried out to assess the vessel's adaptability to a BMD role? However shy the Government may be on that point, we know that the capability exists, and Labour Members should reflect on the assurancesfalse or otherwisethat they may have been given.

Mark Francois: Although the official in-service date for the Type 45 is late 2007, the vessel is a first of class. With such vessels there are often extra trials, so realistically the in-service date will be 2008 or even 2009. Can my hon. Friend therefore confirm that the gap between the Sea Harrier coming out and PAAMSthe principal anti-air missie systemsbeing available on the Type 45 could be two or even three years?

Gerald Howarth: My hon. Friend is absolutely right. The Type 45 is due at the end of 2007. Once it has been to sea, it will be withdrawnas my hon. Friend rightly saystothe principal anti-air missile systemsundergo further trials. It will thus not be available.
	The Minister referred to the Eurofighter Typhoon. Obviously, we all welcome that aircraft. The right hon. Gentleman was entirely right to describe its virtues, although he forgot to remind the House that the Conservative Government were responsible for defining the aircraft in the first place. However, there is cross-party agreement; we are all in favour of the Eurofighter Typhoon, which will perform a valuable role.
	The aircraft is costly, and there has been a delay in the programme, caused in part by collaboration with our European partners. There is a price to pay for such collaboration in terms of the difficulty of achieving partner agreements for complicated projects. However, the benefit of collaboration is that it makes it much more difficult to cancel the programme.
	It is disappointing that the delivery of the first twin-seat aircraft to the Royal Air Force will I understand be in December this year and that the delivery of the first single-seat aircraft is not planned until the second half of next year. One of the problems that that creates is that those dates will run up against the introduction of the joint strike fighter.
	Another example of the delays attributable to European collaboration is the A400M medium-lift transport. It is 10 years since I saw a wooden mock-up proudly displayed at the Farnborough international air show, yet we are currently little further forward. We are still in limbo as regards the engine. When will Airbus make a decision? It was due to do so at the end of this month, but our understanding from Rolls-Royce is that that is unlikely. There are technical difficulties with the 18-ft diameter propellers. The Minister will know of the difficulties encountered with the C-130J and the effects of the new propellers and engines on the aircraft's aerodynamics. What support are the Government giving for the TP400D6 engine that Rolls-Royce is developing with its European partners?
	We await the outcome of a German election to know whether that project, too, will proceed. If Germany decides to pull out of the project, will it be rendered unviable? I think that the Germans are to order about 40 of the aircraft. What happens if they pull out? Will the project continue to stagger from one crisis to the next?
	It is just as well that the Chief of Defence Procurement, Sir Robert Walmsley has, as he put it,
	in my back pocket a financial proposal that we could quickly convert at a known price for two C-17s.
	Presumably, if the A400M project collapses the RAF will require more than an extra two C-17s. Although I accept that the Minister is reluctant to give a deadline for the A400M to proceed, will he tell us whether he is in negotiation with the United States to procure an adequate supply of C-17s? Is he looking to have part of the aircraft built in the United Kingdom, apart from the head-up display that is already standard equipment on every C-17 produced by the US, as it is also standard equipment on every F-16 and F-22 produced? More than 5,000 have been produced for the United States by the United Kingdom.
	We welcome the decision to order Bowman, which was a good example of the Government making a hard decision when a procurement programme had run into difficulties. The Government cut their losses, demonstrating the value of not reinventing the wheel and, where appropriate, of buying something off the shelf that does the job. Bowman is a vital part of the communications system, replacing Clansman. Its secure voice service, secure data messaging and automatic position location navigation recording system should add significantly to command and control operations. As Sir Jock said to the Committee on 1 May, the prospects of getting it in service in 2004 are reasonable. The Minister is holding to that in-service date of 2004, which is good news.
	On communications, the Minister referred to network-centric activities. I am not entirely clear what that is about, although the Minister gave a good explanation. Much has been made of that philosophy applying to modern military activity. In so far as I understand the term, it is right that proper weight should be applied to developing systems that will enhance the dissemination of information, enabling commanders to acquire information quickly, to make better-informed decisions equally speedily and to strike surgically.
	The Ministry of Defence is looking at the application of unmanned aerial vehicles to contribute to that development under the Watchkeeper programme. We welcome that and urge the Government to move swiftly, and not repeat the long-drawn-out process by which its predecessor, Phoenix, arrived. As my hon. Friend the Member for Faversham and Mid-Kent (Hugh Robertson) said, we believe that it is imperative that the equipment is entirely compatible and interoperable with our partner nations, particularly the United States.
	The Minister referred to the need to buy the best, and not necessarily British. All of us believe that we can buy British and best in nearly every case, but that will not always be so. [Interruption.] I am agreeing with the Minister; he does not need to worry. Actually, he probably does need to worry if I am agreeing with him. The Spike missile systemthe new light forces anti-tank guided weapons systemis produced by Israel. If the British Government feel that that is the best system on offer, they should not withhold it from British troops.
	Concern was expressed about sponsored reserves, a subject referred to in the Committee's Report. The Government need to take the good points made there into account. As a Conservative, I never cease to be staggered by the extent to which some Labour Ministers have embraced a philosophy that they have spent their entire political lives until now trying to destroy. We heard the Minister talking with enthusiasm about the private finance initiative. I remind him that we invented the PFI and it has delivered good results across the public sector. However, I would like the Minister to respond to the issue of sponsored reserves rather than wait for a reply to the Committee's report, which will not be forthcoming before the House rises.

Jim Knight: Will the hon. Gentleman give way?

Gerald Howarth: I will not, if the hon. Gentleman will forgive me. I have spoken for a long time, although not for as long as his right hon. Friend the Minister.
	There are some good programmes in the Government's procurement plans. It is very important that we do not analyse projects to death. We must try to get equipment that is more readily available, and not necessarily equipment that meets requirements down to the last and finest detail. We need equipment to be robust and cost-effective. That is the better way to go. A company in Hampshire has told me that it would like the Government to introduce more technology demonstrators rather than trying to get everything right on paper, as technology demonstrators would allow us to see the technology in action.
	Finally, the real question will be the extent to which this substantial bow-wave of procurement programmes is financed. The carriers, the joint strike fighter, the future strategic tanker aircraft and the various other projects that the Minister and I have mentioned will all have a substantial price tag attached. I hope that the Government are confident that they will be able to persuade the Chancellor to part with the money when the going gets toughas it inevitably willso that many of these worthwhile projects are not axed because of insufficient financial provision.

Bruce George: Thank you, Mr. Deputy Speaker. I will continue the remarks that I began to make earlier. I usually approach these debates wearing a Defence Committee hat and by being consensual. However, an Opposition Member will always deliberately provoke me into taking that hat off and being partisan. I will try hard to put that consensual hat back on.
	It is a great pleasure to follow the hon. Member for Aldershot (Mr. Howarth). I do not know how he manages to combine the two onerous tasks of being a senior member of the Defence Committee and a member of the Conservative defence team. If he finds the tasks too difficult to bear, we will reluctantly wave him goodbye. I promise him a champagne reception, which the Minister will pay for[Interruption.] Not out of the defence budget, but out of his own pocket.
	The hon. Member for Aldershot's speech contained a few lapses about the SA80, for which his party must accept a degree of responsibility, and the famous Phoenix, which began its life in about 1977. Two decades later, it came into operation and is now effective. I shall not give my A to Z of Tory procurement failures.
	This Government have not had time to rack up the failures of the Conservative party. After 17 years, we will be able to evaluate exactly how effective their procurement policies have been. I hope to be around long enough to say that the Government have done substantially better.
	Unless provoked, I will not refer to the defence budget, but I can promise the hon. Member for Aldershot that the decline began in 1985. The Tories' great success was to achieve the Frank Allaun goal of bringing defence expenditure down almost to the average of our European partners. If Mr. Allaun knew that, he might have rushed out to vote Conservative becausehere I go again, being partisanthe Tories delivered one of the principal policies of the left wing of the Labour party. Having got that out of the way, I will now get back to serious consensual politics.
	Anyone listening tonight might have imagined that the debate would be fierce and the difference between the parties unbridgeable. In reality, it is not; the difference between the parties now is narrower than it has been in my many years here. Everyone hopes that it will remain that way.
	Procurement is critically important. I have served on the Defence Committee since 1979, and those who have served on that Committee over the years have monitored the MOD's performance in procuring equipment and weapons systems. We have produced dozens and dozens of reports that, over the years, have been fairly consistent in indicating frequent delays, cost escalation and, in many cases, gross under-performance.
	All Governments have tried to introduce a system in which the procurement of weapons systems is efficient and the equipment is produced to time and at a cost relatively close to the original estimate, so that our military personnel achieve most of their objectives when they fire the weapons or drive the vehicles. Smart procurement, or smart acquisition, is the latest in a long saga of attempts to do that, and I shall discuss later whether it has been successful so far or, indeed, whether there are signs of success.
	When annual defence procurement debates were introduced in 1998, our predecessor members of the Defence Committee monitored equipment issues more systematically. The Committee instituted annual inquiries based on a survey of major procurement projects. The goal was to monitor and report progress on a selection of the operationally more significant procurement programmes. Those programmes were on what I call the at-risk register because they were most at risk from predators in the Treasury, trying to play silly games by elongating the procurement process.
	We wanted to report regularly to the House on whether there were any signs of Treasury interference in programmes that were proceeding reasonably successfully. We also wanted to find out whether there were signs of cost escalation. I am grateful to the MOD for responding annually to our requests for all sorts of information. We have 14 separate procurement items on the list, from the future aircraft carrier to the Swiftsure and Trafalgar submarine updates and the private finance initiative projects. The MOD provides us with a great deal of information.
	However, unlike previous Defence Committee reports on procurement, we have a rather different focus. In our first report in 1999, we evaluated the then recent, thankful withdrawal from the Horizon frigate programme and its replacement by the Type 45 destroyer programme. We considered PAAMSthe principal anti-air missile systemwhich is an integral part of the common new generation frigate, as the Type 45 destroyer was then called. In our second inquiry, we considered BVRAAMthe beyond visual range air-to-air missilefor the Eurofighter and the strategic lift programmes. In our third report, we considered the future aircraft carrier and the future joint combat aircraft programmes and all sorts of other things.
	As I have said, our approach has been slightly different in this Parliament, and I am sure that many hon. Members will have read our report, so it would be superfluous to go into any detail. We did not duck the contentious subjects, such as the warship-building strategies, the warship support modernisation initiative, PFI schemes, the decommissioning of the Sea Harrier and information superiority capability. We followed up several of our earlier inquiries on ammunition supply, ASRAAMthe advanced short-range air-to-air missileBVRAAM and the A400M. We made a list of other recommendations, and it is a very good report.
	We have considered some quite contentious issues in the report, and I shall begin with warship procurement. The MOD has had to use the division of work on the Type 45 programme as the basis for steering the future of warship procurement in the United Kingdom more generally, because decisions on the Type 45 programme will have implications for future shipbuilding capacity and the extent of competition for other programmes.
	I sympathise with the MOD; it had to find a solution in very difficult circumstances. We are all aware of those circumstances: too much capacity chasing too little naval work. The MOD commissioned a study by RAND Europe, which showed that there is an uncertain balance between the benefits of maintaining competition in the market and placing all the work with one shipyard to produce economies of scale. A compromise on the Type 45 programme is probably the best that can be achieved in what is a difficult balancing act.
	BAE Systems's yards will assemble the vessels from blocks built by its yards at Barrow and on the Clyde and by Vosper Thornycroft. That will help to keep those yards in business, while allowing economies of scale because of the larger production runs of the same block for each vessel. However, I wish to highlight the risks in that approach. As RAND said, that approach might not stop BAE Systems becoming the only United Kingdom yard able to project manage and assemble warships, reducing the scope for future competition.
	Another possible risk is that the MOD will have to play its part in ensuring that sufficient capacity remains to gear up for an unexpected increase in warship procurement activity, possibly at the end of the decade, as the future carrier and future surface combatants come on stream.
	The MOD rejected the unsolicited bid from BAE Systems to build all the Type 45s because of concerns about, inter alia, the Astute submarine and Type 45 blocks tripping over each other in Barrow's Devonshire dock hall. However, RAND noted that there were similar dangers with the current plan in which it is envisaged that the second and subsequent Type 45s will be assembled at Barrow. Since our report was published, the MOD has announced that the construction of the Astute submarine has been delayed by a year, and I would welcome the Minister's assurance that that will not threaten the Type 45 construction programme.
	I shall refer to a further risk. Having decided on long production runs for the Type 45, there are sound financial reasons why the MOD should order all 12 vessels. I repeat that the Government should commit themselves to ordering all 12 vessels. Until they do so, they will not be able to suppress suspicion that the Treasury will sink some of them. None of that detracts from the fact that, at last, the MOD has begun to tackle a long-running problem in that sector. I should like such work and RAND's analysis to form the basis of a fundamental review of warship procurement strategies.
	We also considered the warship support modernisation initiativea highly contentious issue even on our Committee. As with warship construction, warship support and maintenance has long been beset with fundamental imbalances and ever-falling naval work loads as a result of new maintenance technologies and a shrinking fleet. I recall that, in the mid-1980s, there was a wonderful philosophical debate in the Defence Committee about whether 44 frigates and destroyers was about 50, as the then Government said, or about 40, as the Committee said. I can even remember back to the time when we had 75 frigates and destroyers. I am not quite certain exactly how many frigates and destroyers we now have available because of some directional difficulties that were encountered in the antipodes.
	The warship support modernisation initiative is at least a positive step towards tackling the structural problems. I hope that it will produce the estimated savings of 327 million over five years and 48 million a year thereafter. Some of those savings will come from greater competition for refits negotiated as part of the initiative, and some from rationalising activities across dockyards and neighbouring naval bases.
	Although much of that can and deserves to be applauded, regrettably, as the Minister knows, it comes at a cost. The MOD will have to be very prudent to minimise the adverse aspects of this policy and its impact. Some 1,000 jobssome would say 750will go. We have welcomed assurances during our inquiry that all three naval bases have a secure future. It remains a concern, however, that all of the current naval dockyards may not have a secure future as a result of the warship support modernisation initiative. It seems that Rosyth may have a difficult time without the existence of a co-located dockyard and naval base. What Iand, I suspect, most members of the Committeewant is a sensitive handling of job losses with minimum compulsory redundancies, the protection of essential facilities in the dockyards and naval bases, and care taken to avoid, as far as possible, disruption to sailors and sailors' families as refits are placed according to competition.
	We are told that Sea Harrier is to be withdrawn between 2004 and 2006, six to eight years earlier than planned. First, that has not been an example of good forward planning because some aircraft will be less than 10 years old when phased out. Although part of the decision to withdraw them was based on a new post-cold war security environment, we should note that the latest aircraft were ordered in 1993. It seems fairly clear to me and the Committee that the upgrading of the Sea Harrier to make it effective flying off carriers in hot conditions has presented and will present real technical challenges. In a similar vein, its air defence systemits Blue Vixen radar and ASRAAM missilescould not sensibly be shoehorned into the offensive support RAF Harriers.
	The real question is whether the MOD should keep the Sea Harriers as they are with their imperfections. That, in turn, raises two other questions that our report examined: what other systems could cover Sea Harriers' air defence capability, and do we still need that capability anyway? We highlighted the things that would have to be doneor the assumptions that would have to be madeif a rationale for withdrawing the Sea Harrier were put forward. The Type 45 destroyer and its PAAMS would have to be delivered without delays to its 2007 in-service date. I have already spoken of my concerns in that regard. In the meantime, the improvements planned for the existing Type 42s and their Sea Dart missiles must be similarly pursued with the utmost vigour. The eight years of delays in putting an infrared fuse on Sea Dart must be a thing of the past.
	More fundamentally, the rationale for withdrawing Sea Harrier depends on two all-important foundations. Future naval operations will be for the most part in the littoral environment, supporting land forces, for example, where hostile aircraft will not have to undertake the long run-in towards our ships, which makes them vulnerable to our air defence aircraftmissiles could be fired at us from ground-based launchers with little warning. In those littoral environments, effective air missile defences will be essential, and the Sea Harrier does not provide that. We will have to rely on allies for airborne air defence cover for our shipsthat means the United States. If and when we do fight in the open ocean, for some as yet unforeseen reason, we will have to have the United States alongside us.

Gerald Howarth: I am grateful to the right hon. Gentleman for making a point that I made. Is he aware of other armed forces that have a significant capability in that sphere? He singled out the United States; is he aware of anybody else with that capability who could protect our carrier force?

Bruce George: If we look at the Russians, I am not certain about the extent to which they will be alongside us, although progress and reconciliation has been spectacular. When I think of the significant navies, I am not certain about the equipment or reliability even of some of our allies. The hon. Gentleman draws attention to a point that we need to consider.
	At paragraph 93 of the Committee's report, we stated:
	We recognise that there is a rationale for not upgrading the Sea Harrier, and withdrawing it early from service.
	We talked about the caveats, and concluded:
	There are, then, a lot of pieces that must all fall into place before the Sea Harrier's demise can be regarded with at least some confidence. The MoD must ensure that none are missing. We will be following this process very closely.
	The House can draw its own conclusions from that.
	Our report touched on all sorts of things, including the A400M, about which we all know the details. We concluded:
	Currently, therefore, the MoD finds itself in an enviable position. But if the A400M continues to struggle the secret will be to know when it would be better to deal with someone else.
	That is not elegant language, but it is very clear. I hope that everything will come right, but there are technical problems. Our allies will deliver their financial and technical support and expertise, but a point may be reachedalthough I hope that it is not reachedat which the MOD will have to take some very difficult decisions. Ultimately, it is in the business of delivering to our armed forces that which they want, and that which is affordable in the right numbers. The warning must be made clearly to our European partners that they must deliver or there are clear alternatives.
	We talked about the MOD being beset with collaboration difficulties with both the BVRAAM and the A400M programme. We said:
	It must continue to push its partners on both to show a stronger commitment and remind them that there are other options for the UK if the contract negotiations for these programmes continue to struggle.
	I will not go into the debate about how much our defence budget is increasing. I have seen the briefing, and, although I am not particularly numeratelike my colleague the hon. Member for Aldershot, who is grinning at me as he knows that we are similarly bedevilled by lack of statistical competencethere is, of course, a rise in expenditure, the extent of which we will be anxious to evaluate when the time comes. The fact that there have been two increases in the last three years, after a period of unrelieved and stark decline, is very welcome. I hope that the evaluation that the Defence Committee will make will bear out more or less what the Government are arguingthat the increase has been reasonably substantial.
	I mentioned at the beginning of my speech that, since the second world war, and, I am sure, since the days of procuring bows and arrows[Interruption.] We procured very good bows and arrows to fight the French, and very good archers to fire them. That was one of the successes. As a fellow Welshman, my hon. Friend the Member for Vale of Glamorgan (Mr. Smith) knows exactly what I am saying. Even the supply of swords in the 18th century was a disaster because they snapped. Procurement has persistently been a problem, so the strategic defence review of 1998 made another attempt to try to achieve what has hitherto eluded Governmentsefficient procurement.
	The Select Committee on Defence evaluated the smart procurement initiative and we said that the fact that there was such an initiative was a
	tacit recognition of the failure of some of the past attempts to secure improvement through similar means.
	We were reasonably sympathetic to the initiative, but we said:
	The MoD will need to take deliberate steps to ensure its ability to detect in good time those projects going badly wrong under the more flexible and delegated regime envisaged under smart procurement.
	We recognised that the initiative was designed to bring about improvements and reforms, and we wished the MOD well.
	In 1999, in a report on the common new generation frigate programme, we commented on the problems of European collaboration. With an incredible lack of drama, we said of the Horizon programme that the
	story of European collaborative ventures is not particularly inspiring.
	We could have put it much more strongly.
	In 2000, in our report entitled Major Procurement Projects, we considered procurement equipment programmes and concluded:
	There are . . . some early signs of a more imaginative and robust approach emerging, and these offer a glimpse of what improvements the initiative may be able to provide.
	In 2001, our report on the MOD's annual reporting cycle said:
	Despite the difficulty in reconciling the MoD's performance data, the results do indicate satisfactory performance against targets for cost overruns, if not on delays.
	So there was some progress there.
	The National Audit Office's Major Projects Report 2001 was mentioned earlier. Paragraph 4 on page 2 states:
	Our overall conclusions are that, there is evidence of continued improved cost control, that delays are beginning to be brought under control, and although the proportion has fallen slightly (from 98 per cent. to 93 per cent.), the Department is still expecting to meet the majority of the technical requirements of customers.
	Therefore, there are early signs that progress is being made, but it is far too early to be absolutely certain that the system is becoming much more efficient. If that happens, it will take place over the next five to 10 years.
	The debate has suggested that there is not much between us. A budget of 2.5 or 2.6 per cent. is realistic in the circumstances, and some welcome increases have been wrung out of the Treasury. Should the security environment deteriorate, I hope that the budget would increase in response. However, we must recognise that, among many other problems, it is difficult to procure anything in less than 15 years unless we are prepared to buy off the shelf. Even the United States does not have a limitless capacity to crank out aircraft and other equipment simply because its strongest ally wants that equipment suddenly because of a deteriorating environment.
	The budget increase is welcome, and we will reflect on it. We should give a partial pat on the back to Ministers, the Defence Procurement Agency, the MOD and all concerned. A hearty pat on the back is better than the knife between the shoulder blades with which they are more cognisant. I hope that progress will continue, because the taxpayers requires weapons that are necessary and that can be delivered while the services want systems that work. There are good signs that the interests of Parliament, the taxpayer and the military can be reconciled. We must work towards that end.
	We on the Defence Committee will continue to be frank and critical when necessary and supportive when we can. We hope that some of our recommendations will find their way through the labyrinth towards effective decision making. Perhaps the Select Committee system will come of age and will be seen not as a reluctant partner that must be tolerated but more constructively as something that can assist the MOD to undertake its tasks more effectively. As a former permanent secretary in the MOD and now, I am delighted to say, an adviser to the Committee has said, The better you are as a Committee, the better we have to be. I hope that the Committee can improve its performance and that that, directly or indirectly, will help the MOD to improve its performance, so that people outside shout Hallelujah. 7.16 pm

David Laws: I begin with the issue that the Minister first mentionedthe MOD budget and the change that the spending review has made. Without that budget, there is no procurement. The tensions in the budget over the past 10 or 15 years have been behind the pressures on the procurement budget that have been experienced in that time and over the life of this Government.
	We were led to believe by the Chancellor of the Exchequer's statement on Monday that the MOD had received a rather generous settlement. Indeed, the MOD had an unusually early mention in his statement as if to flag up the priority that it had received in the spending review. Then we received confirmation of the importance that the Government put on the issue in the joint press release that was issued by the Chancellor and the Secretary of State for Defence. It was headed, Gordon Brown announces billions extra for defence, and it quoted the Secretary of State for Defence as saying:
	This is an excellent settlement for defence.
	I will not use the word spin, because I do not identify the Minister as a spinner. However, the Chancellor has a reputation in his Budget and spending statements of not needing always to be taken at face value. We therefore need to compare the reality of the Government's announcement on Monday with the figures that have been released.
	The right hon. Member for Walsall, South (Mr. George) said that the Defence Committee would consider this issue, so perhaps I should draw his attention to the Government's document on the spending review that was published on Monday. Table 1.3 helpfully gives all the annual growth rates in real terms of every single Department over the period of the spending review. We would, of course, expect the big public service Departmentsthe Departments responsible for education, health, crime and transportto be at the top. We would not necessarily expect the MOD to have a comparable budget increase. However, we discover that not only are those Departments doing better than the MOD but, as the hon. Member for Aldershot (Mr. Howarth) pointed out, other Departments surprisingly outshine the MOD by a long way. They include the Department for Culture, Media and Sport, the Foreign and Commonwealth Office, the Lord Chancellor's Department, the Office of the Deputy Prime Minister and the Chancellor's Department itself. In fact, only one of the Departments listed in the tablethe Department for Work and Pensionshas an annual growth rate of expenditure less than that of the Ministry of Defence. If we add the changes to annually managed expenditure, which are not reflected in the table but will form part of the budget of the Department for Work and Pensions, we discover that the Ministry of Defence has had the smallest real increase in the spending review.
	I do not ignore the fact that the background to the problem is a 15-year period in which we saw a sharp contraction of the defence budget. I do not fail to acknowledge that the Secretary of State has halted that decline in this and the last spending review. However, no one should be under any illusions, and the Government should not create the illusion, that that will create slack in the budget or that pressure on the procurement budget will ease. The settlement will lock in the decline in the defence budget and the decline in capability that went with it. Expenditure this year and over the period of the spending review will increase by 1.2 per cent. in real terms, but much of the Minister's budget is for pay as well as procurement. As those tend to increase above inflation, the extent of the challenge that the Ministry faces becomes clear.
	When I intervened on the Minister, he was not surefooted in his response. I asked what he thought about today's evidence to the Treasury Committee from two distinguished Treasury officials, Mr. Sharples, a friend of the Prime Minister and head of public expenditure at the Treasury, and his colleague, Mr. Macpherson. They confirmed something that is clear if we flick to page 167 of the spending review document: expenditure by the Ministry of Defence will be less in real terms in every year of the spending review than its expenditure last year. I hope that that puts into context the nature of the budget challenges that face the Ministry and the fact that we still have difficult procurement issues to address.
	I am not asking the Minister to rely only on the spending statement or on the Treasury officials to support my case. I have the same briefing document on expenditure as the hon. Member for Aldershot, which confirms the figures to which he drew our attention. It also shows that if we use the base year of 200102, the budget falls over the following four years by just over 300 million. The average annual real change is, therefore, a fall of 0.3 per cent.

Lewis Moonie: To save me from having to spend too long on that in my winding-up speech, there is a vast difference between outturn figures and budgets. The hon. Gentleman is comparing an outturn figure, which includes contingencies that are always paid by the Treasury, with the forecast budget figure, which underpins our regular spending. He is 100 per cent. wrong.

David Laws: Although the Minister says that I am 100 per cent. wrong, I am, in fact, 100 per cent. right because the figures in the document bear out the claim that in every year of the spending review real expenditure will be lower than it was last year. Regardless of the contingency claims, that demonstrates that the Ministry of Defence budget remains under pressure.
	I notice that the Minister did not challenge what I said about the Ministry having the lowest increase in real terms of any Department other than the Department for Work and Pensions and, when we include the change in annually managed expenditure, that it comes bottom of the list. I am sorry if the Minister does not like those comments, but he should look at the documents. Perhaps he is irritated and upset because the Chancellor managed to pull the wool over his Department's eyes. Perhaps he does not like the reality of the figures, which do not live up to the Chancellor's spin, but they are in his Department's documents.
	We are grateful to the right hon. Member for Walsall, South for the excellent report that his Committee produced last week on major procurement projects. I shall focus on the four or five projects on which there are the most substantive concerns or the greatest differences of opinion. I accept his general point that there is, thank goodness, a great deal of unity among hon. Members on the overall approach taken by the Ministry of Defence, but we must concentrate on the matters that concern us.
	The Minister gave the impression that the Select Committee's report was mildly supportive of the decision on the Sea Harrier. Having read the report and listened to the comments of the right hon. Member for Walsall, South, the Chairman of the Select Committee, I must say that they are a strange endorsement indeed. In paragraph 92 of the report, the Committee notes:
	We are forced to conclude that . . . the UK has already decided that in another five years it will rely on others
	other nations, that is
	for air-defence patrols for our naval task forces.
	The hon. Member for Aldershot asked on whom we might rely to take over the vital role of air patrols at sea. The right hon. Gentleman said that the only alternative to the United States of America is Russia, a country on which no one would want to rely to secure our future defence needs.
	I am sure that hon. Members agree that we must ensure that the strategy for the future of our defence is sufficiently flexible so that we can fight any reasonable campaign. We cannot be sure that the campaigns that we might have to fight over the next five to 10 years, when we might have no proper air cover for our fleet, will receive the support of the USA. If we cannot be sure of that, we cannot be sure of the support of any other nation either.
	The Minister said that he is taking a decision on the balance of risks and that the technical upgrade of the Sea Harrier is risky. However, he should acknowledge that he is transferring one risk for another. He does not want to risk upgrading the Sea Harrier but, as a consequence, he is taking the risk either that our armed forces will not be able to engage in operations requiring that layer of air cover or that we will engage in those operations in circumstances that endanger our armed forces, which would be even worse.
	There is deep non-party political concern among hon. MembersI certainly detected it in the Select Committeeabout the Government's decision. I urge the Minister to reconsider it because, in a world of second best, it might be better to spend money prolonging the life of the Sea Harriers rather than losing the significant capability that allows us to deploy the Royal Navy with air cover. The experience of the Falklands war reinforced the fact that we cannot rely on ship-based missiles to defend our forces, especially at sea, because the ability of our enemies to deploy missile technology against us is changing and improving all the time. Defence Ministers and generals used to be criticised for always wanting to prepare to fight the last war. My concern is that we seem to be unable to fight even the last war, let alone the next one. I hope that the Government will re-examine that matter.

Mark Francois: The hon. Gentleman mentioned the Falklands. I am an Atlanticist by instinct. If anybody is likely to support us, it would probably be the United States. We now know that the United States provided us with assistance in the Falklands, but even they did not send us the USS Nimitz. That was a real scenario in which we could not rely even on the US for carrier-based air power. It is not fantasy to say that a problem exists.

David Laws: I entirely agree. We simply cannot predict the type of environment that we will be in or the defence choices that we will have to make. We cannot be sure of future circumstances and the level of support that we will receive from our potential allies, even the United States. Over the next five to 10 years, the Government risk putting us in a position in which we cannot pursue our defence interests or have to take unacceptable risks to do so. I hope that the Minister and the Department will reconsider the issue.

Adam Ingram: It is easy for the hon. Gentleman to throw around scenarios that have no bearing on reality. Will he accept that the period from the non-availability of the Harriers to the availability of the new fleet is about 18 months, not the five to 10 years that he has just quoted?

David Laws: There are two points. First, if we are to rely on aircraft rather than simply on ship-based missiles, that period would be longer than the Minister has indicated. We allnot least the Minister and his Departmentknow about the potential for new orders to slip. What could start off as a two, three or five-year gap could easily slip into a much longer one. We would not only risk our flexibility in defence policy and our armed forces during that period, but run down the skills and abilities of the air crew who are currently involved in such operations. They are specialised and skilled and would be difficult to maintain without Sea Harriers.
	Secondly, in responding to the hon. Member for Aldershot, the Minister said that, at the moment, the Government do not intend to change the number of Eurofighters to be ordered. We know how these things can change and that current Government policy is to order 232 Eurofighters. Are the Government considering not taking the later tranche of Eurofighters because of slippage of the programme, the pressures on the procurement budget and on the defence budget in general and the fact that the arrival of later tranches of Eurofighters will be close to the arrival of the joint strike fighter?
	That matter is slightly unclear and I look forward to gaining some insight into it when the Under-Secretary replies. Are the Government considering transferring orders between the Eurofighter and the joint strike fighter? The Minister will know that regardless of what is said in the House, many people, including defence experts, those who have recent experience of such matters and perhaps those on the Defence Committee, are sceptical about the Government's willingness to deliver on the 232 Eurofighters and believe that, eventually, they will order a much lower numberperhaps even fewer than 150.
	The third issue is lift capability, which has not been much discussed today. However, it is an extremely important issue in light of the fact that the Minister and his Department envisage that we will be engaged, not in the static warfare that we might have fought in western or eastern Europe, where we would be able to reinforce from Germany or our own shores, but in operations in which, typically, we might have to deploy all over the world. Has he evaluated our lift capability, including the capability of our helicopter fleet? He would be disappointed if I did not mention helicopters. Has he calculated whether our current lift capability matches the requirements that he and his Department believe we should have?
	Does the Minister believe that we should consider bringing forward the Sabre project, which would look at a replacement for Puma and Sea King? Obviously, I am not going to try to influence the Minister by suggesting an ideal replacement. He knows that many excellent products come out of the west country, and this matter must be considered in the normal, rigorously competitive way. Without mentioning specific products, can he say whether lift capability has been evaluated and whether it is considered a problem?
	My fourth point has been aired by a number of hon. Members: the SA80. Today, The Sun has a cartoon showing a typical battlefield of the future, with new unmanned aircraft using all sorts of sophisticated technology to scan information and pick up what is happening. It ends with a picture of the Prime Minister in Downing street following all the information as it comes in. All that sounds wonderful, and if we can get the technology right, it may be the way of the future.
	While we are waiting for that fantastic new technology, however, there remains concern, as the Minister has acknowledged, over the most basic product on which our armed forces relythe rifle. He said that he does not want to make irresponsible statements or raise fears unnecessarily and that he is conducting an investigation into the product to find out whether it is good enough. We understand all that, but he will understand that there is already great concern about that equipment which extends into the armed forces.
	When the Under-Secretary winds up the debate, will he go a little further and say more about the time scale for the decision that will be made? Can he give us a firm commitment that if the Department concludes that the product is not reliable enough in the extreme conditions in which we may deploy our forces, it will be willing to make a potentially large investment to find a new piece of equipment to do the job? Does he agree that the issue is too important and basic to be subject to budgetary constraints and to be offset against other items in the procurement budget?
	Finally, will the Under-Secretary shed some light on the matter of unmanned aerial vehicles, to which I just referred? The other day, the Minister of State answered several questions asked by my hon. Friend the Member for Hereford (Mr. Keetch) about the Phoenix system and its possible replacement. That project has been long delayed and there has been much comment about the effectiveness, or potentially the ineffectiveness, of Phoenix. Does that project still have some life in it, or do Ministers consider it dead? Will it be replaced by the new Watchkeeper system that is being considered?
	Those are some of the major issues on which we need answers today. I see from the Minister of State's reaction that I have hit on some of the right issues; I seem to have enlivened him. I look forward to enlightenment in the wind-up not only on the salient procurement issues but on the budgetary issues about which all hon. Members have expressed concern today.

DEFERRED DIVISIONS

Mr. Deputy Speaker: Order. I have now to announce the result of the Division deferred from a previous day.
	On the Question on Section 5 of the European Communities (Amendment) Act 1993, the Ayes were 275, the Noes 179, so the Question was agreed to.
	[The Division Lists are published at the end of today's debates.]

Defence Procurement

Rachel Squire: I shall touch on several issues. First, as my right hon. Friend the Member for Walsall, South (Mr. George) anticipated, I want to talk about defence procurement as it affects my constituencynamely, Rosyth dockyardand secondly, I want to deal with some of the wider issues affecting defence procurement, British defence manufacturing and the interoperability of our forces with our United States and European allies, especially post-11 September.
	I begin by saying how much I disagreed with the comments of the hon. Member for Yeovil (Mr. Laws) as regards the budget and the comprehensive spending review, and how much I welcomed the announcements on defence spending made earlier this week by my right hon. Friend the Chancellor of the Exchequer. The debate has been given additional importance by the announcement of the largest increase in defence spending for 20 years, representing 1.2 per cent. growth per year in real terms for the next three years. I trust the Government to deliver, and I trust that in three years' time the hon. Member for Yeovil may be willing to acknowledge that his figures were not correct.

David Laws: I am grateful for the hon. Lady's patience, given that she has only just started her speech. Surely she is aware that the figures that I quoted are from the Government's own document. Which of those figures does she disagree with?

Rachel Squire: I was aware that they were in the Government's own document but, as became clear during the Minister's speech, in this House the interpretation of any quoted figures is often very much subject toshall we say?political bias.
	I trust that the extra defence spending that was announced on Monday will be delivered. The Government have already shown their commitment to, and acknowledged the importance of, additional defence expenditure post-11 September. The events of the past few months make it even more vital that we provide our armed forces with the equipment and technology that they need for effective operations anywhere in the world. I pay tribute to the British armed forces, who have excelled themselves, especially in the past 12 months. Whether they are engaged in war fighting or peacekeeping, there are none better. We owe it to them to provide the equipment, support and logistics that they need, when they need them. We also owe it to their families to give the troops guns that fire and communications systems that work. When we talk about procurement, we must recognise that the core ingredient of any decision is people, whether they are members of the armed forces, employees in our defence manufacturing base, or those providing the vital support services that are needed to keep our planes flying and our ships afloat.
	That brings me to Rosyth dockyard. I want the Minister and hon. Members to recognise the major changes and challenges that Rosyth dockyard has dealt with in the past 10 years. Its core and secure area of worksubmarine refittingwas removed by the disastrous, costly, and politically motivated decision of the previous Conservative Government. Rosyth naval base was closed, the entire dockyard was removed from the Ministry of Defence and sold to a private company, and the dockyard work force had to deal with thousands of redundancies and major changes to pay, conditions and working practices. I pay tribute to the dockyard work force not only for surviving the equivalent of a hurricane, but for achieving so much and looking to their future rather than the past.
	A very effective partnership has been developed between Babcock Rosyth and the work force, and in recent years the dockyard has won additional work against fierce competition. It has reduced its costs and has delivered on cost and on time, and there has been high praise from the Navy, the Government and many parts of the MOD for Rosyth's skills and expertise, particularly as demonstrated by its recent refit of Ark Royal. It has delivered, to use the words of my right hon. Friend the Minister, real value for the defence pound. Given the recent unfortunate incident involving HMS Nottingham and the damage that she incurred, I would put in a bid for Rosyth dockyard being well equipped to help to mend that ship and to deliver her to full operational value. I should add that Babcock Rosyth has contacts in Australia and Babcock owns a dockyard in New Zealand.
	As regards future procurement decisions, the reality for Rosyth is that, despite its present work load, in two years' time that allocated programme of work will have been reduced to virtually nothing. My right hon. Friend the Minister said today that industry must seek new work and not always rely on the Government to deliver it. I would make three points in response to that. First, Rosyth dockyard is providing the best, and at a good price. Secondly, it has vigorously sought other work and ventures elsewhere, with some success, but it is not sufficient to maintain a work force of 2,000. Thirdly, it is not competing with other dockyards on a level playing field, because the other two dockyards concerned have between them a guarantee of 10 to 20 years' work on submarines and the Type 45. Moreover, they have naval bases attached to them, with the admirals no doubt occasionally expressing their point of view.
	I am worried by the trend in the thinking of the Defence Procurement Agency and the Ministry of Defence whereby all refit and maintenance work is to be located at the base port, because that would severely disadvantage the Rosyth dockyard work force. Given what Rosyth has delivered in cost savings and efficiency, combined with high standards of workmanship, I hope for a commitment from the Minister that it will have the same opportunities as the other two dockyards in obtaining naval work and competing on a level playing field. As the workers of Rosyth have told me, they have delivered on the demands made of them by Babcock and the MOD, and they would now like their efforts to be recognised and rewarded with some kind of secure future.
	That brings me to one of the major procurement issuesthe future aircraft carrier. Whichever company it is decided will be the prime contractorThales or BAE SystemsI urge it, the MOD and the Government seriously to consider bringing the assembly work to Rosyth. They would not regret it.
	Rosyth has unrivalled experience in refitting and supporting the current aircraft carrier fleet and other types of warship. It has a deep water channel with unrivalled access to the sea. The Forth is not congested with a large volume of commercial shipping and leisure craft. Rosyth is adjacent to Royal Naval Armaments Depot Crombie, the only suitable deep-water berth in the UK for rearming a ship. It continues to have HMS Caledonia to support naval personnel and their families.
	Rosyth has the largest non-tidal basin for ship repair in the UKan ideal environment for assembly, outfitting and maintenance activities. By widening an existing dry dock and other modifications through a single investment, it could provide a facility suitable for assembly, outfitting, commissioning and maintenance as well as sufficient labour to undertake the work, drawing on a highly skilled work force from throughout Scotland and the north of England.
	Before I conclude my comments on Rosyth dockyard and the possibility of a major share of the aircraft carrier work of the future, I want to emphasise that the dockyard work force acknowledges that work has been provided, and that without a change of Government in 1997, the yard would probably have closed by now. It welcomed the commitment that the Labour Government demonstrated to the biggest warship-building programme in more than 30 years.
	I believe that the dockyard work force is also well aware that the defence procurement proposals of those who promote independence for Scotland, who are again notably absent, would mean, at best, a single, small warship. That is hardly sufficient to keep Rosyth, Faslane or the Clyde shipyards in operation.
	Procurement is about delivering on cost and on time the equipment that our armed forces need to do the job that we ask of them to maximum effect. I want to make three points about that.
	First, it is important to give all ranks, not only the most senior, the opportunity to comment on the design and type of equipment that they need to do the job. I understand from the Defence Procurement Agency and the integrated project teams that that is being done now. I hope that the opportunity to comment and influence will be increased.
	Secondly, it is vital to have a quick fix process for pieces of equipment that clearly do not work. We have heard a great deal about the SA80s, so I shall not go over ground that has already been covered. I welcome the measures that the Government have put in place to try to ensure that we never repeat the saga of years of failure of equipment and of failure to tackle the problem properly. I look forward to ensuring that our armed forces have the equipment that gives them what they need when they need it.
	Thirdly, we accept, especially after 11 September, that no nation's forces are likely to operate alone. It is therefore even more important to consider the interoperability of new equipment, especially with our NATO allies. However, although we try to achieve that, we do not want to rely totally on one other countrythe United Statesfor our defence procurement and equipment. In defence procurement, like other aspects of defence policy, Britain must balance its European and its US interests. The rationalisation of the defence industry in Britain, in the US and throughout Europe requires us to perform a tough balancing act.
	Although our alliance with the US is close and important, it is not an equal partnership in defence manufacturing. The US admits that it should remove some of the needless bureaucratic and lengthy delays that its system currently imposes on British firms that are trying to compete in its market. However, there is little evidence of its acting on that yet. I would welcome hearing from the Minister whether any recent discussions have taken place between the MOD or the Department of Trade and Industry and the US on providing a more level playing field for British firms.
	We cannot and do not want to go it alone in producing all the defence equipment we need or in tackling all the conflicts and challenges with which the world presents us. Britain is rightfully proud of its engineering skills and the reputation of the British armed forces. We must aim to ensure that our defence policy, especially our procurement policy, allows us to build on and maintain that reputation and to be described as simply the best.

Mark Francois: I am pleased to follow the hon. Member for Dunfermline, West (Rachel Squire) and to contribute to the debate. I acknowledge the Minister's courtesy in giving way on numerous occasions, including to me more than once. He or the Under-Secretary may want to return the compliment before I sit down because I shall focus on the proposed procurement and disposal of aircraft.
	The Government's 1998 strategic defence review reoriented Britain's armed forces towards an essentially expeditionary strategy. In a press conference shortly after SDR was announced, the then Secretary of State for Defence, now Lord Robertson, Secretary General of NATO, summed up the change:
	If the war is no longer going to come to us, then we may have to go to the war.
	That realignment of Britain's armed forces had important implications for their associated equipment programme, with a renewed emphasis on equipment to facilitate expeditionary warfare such as transport aircraft, helicopters and amphibious shipping.
	A centrepiece of the new force structure was the decision to replace the Royal Navy's three existing aircraft carriers of the Invincible class with two new, larger aircraft carriers, which would allow for a far larger complement of aircraft, including what has become the F-35 joint strike fighter. The new carriers are intended to enter service in 2012 and 2015. They will be escorted by the new Type 45 destroyer, equipped with the equally new principal anti-air missile system or PAAMS.
	The first new ship is due to enter service in late 2007 to replace the Type 42 destroyers, which are armed with the increasingly obsolescent Sea Dart anti-air missile system. As I said earlier, the first Type 45 will be a first of class. That means a prolonged trials process. From past experience, that could extend the in-service date until the ship is declared operational into the fleet in 2008 or even 2009, especially if PAAMS does not perform as advertised, straight out of the box, first time around.
	Those points are important because air superiority is crucial to 21st century military operations. As the strategic defence review White Paper pointed out in paragraph 87 on page 22:
	Air power will be a crucial factor in maritime operations, on most battlefields and as part of the most demanding peace support operations, as in Bosnia in 1995. Air superiority and air defence will be essential for a wide range of deployed operations.
	We should ask, therefore, what the implications are for our expeditionary warfare capability in the decade ahead before the first of the proposed new carriers becomes available. To begin with, there has been considerable speculation about whether the two new ships will still be delivered according to the original schedule. I hope that they will be, but even if they are, the Royal Navy will still in the meantime have to provide support for expeditionary operations with its existing assets, which would have to be run on until the carriers and their new aircraft join the fleet.
	However, the Government have since taken the controversial decision to withdraw the Sea Harrier from Royal Navy service between 2004 and 2006. The Government allege that they have to do so because the aircraft suffers performance limitations in certain hot climates and they cannot afford an engine upgrade to address that. In seeking to justify this, the Government have also sought to stress that the carriers will still carry the GR7/9 variant, which is optimised for ground attack rather than for air defence.
	As Ministers will recall, there was a very lively debate about the decision on 8 May in Westminster Hall. It would be charitable to say that the Government did not exactly win the argument that morning in seeking to justify their decision. We were told, for instance, that the Sea Harrier, which was combat-proven in the Falklands campaign, has to go because it is an old aircraft, being more than 20 years old. However, the Jaguar is nearly 30 years old and the Canberra has been in service for virtually half a century and is still going strong.
	Moreover, the Sea Harriers have been significantly upgraded. Beginning in 1994, the then Government invested 466 million in upgrading the aircraft to the new F/A2 standard, with a more capable radar and associated electronics, and medium range air-to-air missilesmaking the F/A2 one of the best air defence aircraft in Europe and considerably more capable than the aircraft that fought in the Falklands.

Jim Knight: I acknowledge comments in the Defence Committee's report about the weaknesses of abolishing the aircraft so quickly following the last upgrade, but does the right hon. Gentlemansorry, the hon. Gentlemanacknowledge that even following that upgrade the aircraft is still no defence against sea-skimming missiles? Given that many of the savings from getting rid of the Sea Harriers are going into the upgrade of GR7s and GR9s, does he agree that on balance and on the cost-benefit analysis, the MOD's decision has considerable merit?

Mark Francois: I thank the hon. Gentleman very much for inadvertently promoting me; it is a burden that I shall live with. Exocet, which hit the Sheffield in 1982, was a sea-skimmer, but it was launched from an aircraft. Therefore, it is important that we keep any threat aircraft that can be armed with missiles designed to sea skim in the terminal phase as far away from friendly shipping as possible.
	The last of the upgrades begun in 1994 was completed just a few years ago, so the considerable investment of almost 500 million of taxpayers' money will, effectively, be largely foregone if the aircraft are scrapped early before the new JSF is available. It makes very little sense to upgrade those aircraft and then scrap them just a few years later.
	I believe that there are still powerful reasons why the Sea Harriers should not be retired early, as the Government envisage. First, doing so will seriously weaken the defence of our expeditionary forces. As Ministers have pointed out in this debate, the theory of naval air defence is based on a concept of layered defenceaddressing the threat from as far out as possible. Sea Harrier, with its look-down, shoot-down radar and medium-range missiles, allows a fleet commander to do that considerably beyond the horizon. Without the Sea Harrier, that critical outer layer is removed, thus allowing threat aircraft that carry certain classes of air-to-surface missiles to get much closer to the target shipping and to threaten to saturate the ship-based defencesin other words to overwhelm the defence by getting close enough.

Jim Knight: I would be interested to know which potential adversaries the hon. Gentleman thinks have such technology, which would be a threat to us if we did not have the Sea Harrier.

Mark Francois: First, as I understand it, a number of middle eastern states have air-to-surface missile technology, as indeed does China. I cite those two examples off the top of my head, but I am sure that I could come up with others.
	Secondly, Sea Harriers should not be retired early because doing so threatens to denude offensive operations. In littoral operations of the kind often envisaged in the strategic defence review, the Sea Harriers might be needed to provide top cover for the GR7s against intercepting enemy aircrafta role the land-attack Harriers are effectively unable to carry out for themselves.
	In the debate on 8 May, my hon. Friend the Member for Hertford and Stortford (Mr. Prisk) used the good analogy of a shield, the Sea Harriers, and a spear, the GR7s. By this decision, we would not only remove the shield but blunt the spear wherever the enemy has air defence aircraft of its own that could threaten the GR7 Harriers as they went into attack.

Jim Knight: I am exceptionally grateful to the hon. Gentleman for giving way a third time. He talks of shields and spears, and he will be aware that occasionally people use a two-handed sword rather than a sword and a shield. He mentioned some possible adversaries who have the technology to threaten us if we do not have Sea Harriers. Does he envisage that we would ever go into combat with such nations on our own?

Mark Francois: In early 1982, no one envisaged that we would go into combat to defend the Falkland Islands. History shows again and again that we must prepare as far as we practically can for the unexpected. The great problem with this decision is that it assumes that we will fight only in certain given scenarios. History shows that that is probably a mistake.
	Thirdly, Sea Harriers should not be retired early because there are important implications for rules of engagement. I do not think that that has been mentioned. The Sea Harrier allows a fleet commander to identify visually a potential threatthat could turn out to be a civilian airlinerrather than rely just on the interpretation of a radar image. Without that capability, and even allowing for helicopter-borne airborne early warning, the fleet commander is partially blinded and can only take a launch/don't launch decision about his missiles when the contact is much closer in and he is under much greater time pressure to do so. Crucially, he cannot visually check until it is perhaps too late. All those important operational constraints could put a naval task force heading into harm's way at serious risk if it were attacked from the air.
	Ministers have already conceded that the decision involves an element of risk. On 29 April the Minister told the House:
	There is an associated risk attached to all of this, but it is without question a decision based on the balance of investment.[Official Report, 29 April 2002; Vol. 384, c. 660.]
	My contention is that it is a greater risk than Ministers have been prepared to acknowledge, perhaps even to themselves. In short, it is not possible to maintain a credible commitment to an expeditionary strategy that lies at the heart of the SDR, and then to announce the abolition of carrier-based air defence for six years. If the Government wish to press ahead with the decision, they should acknowledge that the expeditionary strategy envisaged in the SDR will be largely in abeyance for six years between 2006 and 2012.
	All that being so, the Sea Harriers should still be run on. As my hon. Friend the Member for North Essex (Mr. Jenkin) argued from the Front Bench in Westminster Hall:
	We can all agree that it is desirable to upgrade the Sea Harriers' engine and we know that it will be expensive. Even if the Government cannot afford the engine upgrade, I submit that Sea Harriers with the existing engine remaining in service as long as possible is much better than no Sea Harriers at all.[Official Report, Westminster Hall, 8 May 2002; Vol. 385, c. 86WH.]
	That sums up the situation in a nutshell. Moreover, in cold climates, there are few constraints, and even in tropical conditions the aircraft could still be deployedperhaps operating with lighter loads if necessary in order still to provide some capability.
	Ministers have already conceded that the decision was partly due to financial reasonsit was a balance of investment decision. Given the extra resources apparently announced for defence in the comprehensive spending review, is this not a suitable opportunity for the Government to concede that they have got this one wrong and that some of the additional resources could be directed to rectifying the mistake? That would maintain integral air defence cover for the Royal Navy until the new carriers and their associated aircraft were available. Furthermore, it would not expose the fleet and whomever it was assigned to protect to unacceptable risk for six years or more.
	Ministers have been unable to carry the House on this subject today. I do not believe that they have won the argument. If they want to repent, this would be a very good time for them to do so, and I sincerely urge them to reconsider this dangerous decision while there is still time.

Mark Tami: I would like to begin by joining other hon. Members in warmly welcoming the extra money for defence pledged by the Chancellor in the latest round of the comprehensive spending review. I am sure that Conservative Members will get tired of hearing that it is the Labour Government who have provided the largest increase in defence spending for more than 20 years, with resources growing by more than 1.2 per cent. a year in real terms to 200506. We should also remember that the Conservatives cut defence spending by a third in their last 10 years in government.

Gerald Howarth: As the hon. Gentleman is clearly critical of the last Conservative Government and the extent to which they cut defence spending, will he tell us by how much we should have cut it and how much more money we should have spent on defence than we did?

Mark Tami: I am not going to enter into a debate about how much the Conservatives should have cut. They talk a good fight on defence, but it is the Labour Government who are putting the investment in, when and where it is actually needed.

Jim Knight: We should talk about real spending.

Mark Tami: That is right. The Labour Government, in marked contrast to the Conservatives, have put the finances of this country on a sound footing and delivered a stable economy, low interest rates, low inflation and low business taxes, and that has enabled us to invest in the security that the people of the nation deserve.
	The cold war is now something that is taught in history lessons at school, rather like the second world war was in my time at school. We now see more of the cold war in James Bond films than anywhere else in the media, and many teenagers have probably never heard of the Soviet Union. The world is vastly different from when the Berlin wall came down. The old days, when we planned for nuclear and conventional conflict in mainland Europe, with tanks rolling across the plains, have gone from our thinking.
	The world is different now; it is far more complex and unpredictable and, therefore, potentially more insecure. In the United Kingdom, we are right to recognise, especially through NATO, that these new insecurities bring new responsibilities and a new role. Rapid reaction, conflict resolution, and maintaining a strong deterrent are the order of the day. Our commitments are as many as they are diverse. The Government were, therefore, right to recognise that our defence policy had to be brought up to date by the strategic defence review, on both procurement and equipment issues.
	Nothing should compromise this country's ability to honour its international commitments and maintain its national security. That is why we must have value for money and, equally, a framework that can deliver what we really need. Value for money alone can never be a sufficient criterion. When we look at procurement policy, we should look at the whole picture. We should consider not only the purchasing of the equipment, but the way in which we maintain it once it is in service.
	There is a growing trend in linking maintenance with a supplier as part of the purchase arrangements. In some cases, that clearly makes sense, but we must also consider the effect of such a policy on our in-house capability at the Ministry of Defence, and in particular, at the Defence Aviation Repair AgencyDARA. In my constituency, DARA, at RAF Sealand, provides vital support to our armed services. It has dramatically improved its efficiency and flexibility and is now gaining new contracts through greater commercial freedom.
	We should not, however, lose sight of the principal role of the agency, which is to keep our defence forces in prime operating condition. This vital role was perfectly illustrated during the recent conflicts in Bosnia and, before that, in the Gulf, when the agency worked flat out to keep our front-line services at full fighting strength. If we had not had that capability, or that flexibility, I doubt that we would have achieved the success that we did. I certainly question whether normal contract arrangements would have delivered the level of support that was needed, or that was achieved. We cannot simply contract everything out. It is vital, now more than ever, that we maintain and expand this viable in-house capability.
	No one would have predicted the events of 11 September or the international war on terrorism that has followed. But no one predicted the conflicts in the Falklands, in the Gulf or in Bosnia. We are not able to predict, but we must always do our level best to prepare and to plan for future challenges and changes in our global environment. We need to be smart in our buying, but also smart in our planning. That is why we need to place a strong emphasis on supporting British manufacturing.
	If I may, I would like to pay tribute to those in the trade union movement, including those in my own union, Amicus, who have done so much to support British manufacturing and the immense contribution that it makes to the prosperity and success of our whole economy. Britain has long been one of the world's leading defence manufacturers, employing well over 100,000 people in good quality jobs. While we have a highly successful export market, the industry clearly also relies on domestic orders. Whenever it is possible and viable to do so, the MOD should look to British manufacturersand certainly British-based manufacturerswhen it is making its purchases.
	I welcome and fully support the MOD's decision to purchase 25 A400M transport aircraft. I think that it should have bought more, but that is a start, and I hope, along with our European partners, that the project will be allowed to go ahead. The A400M demonstrates the difficulties often faced by British and European manufacturers in competing with America. The amount of research and development expenditure available in the US often results in American companies being in a better position to bring a finished product to the table.
	Opting for American companies will often deliver jobs to this country. Indeed, Raytheon has brought many jobs to my own constituency through the Astor project, and they are certainly welcome. However, if we had opted for the C-17 transport aircraft, or an uprated Hercules, we would have had none of the associated intellectual property rights. So, while that would have created jobs in this country, we would not have been in a position to grow those jobs. The A400M, on the other hand, has great export potential, and we should be able to expect an expansion of jobs as orders for it increase. Intellectual property is therefore the key, and we must take that fully into account in our procurement policy.
	Although we have, I hope, decided on a transport aircraft for the future, we have yet to decide on a replacement for our ageing air tanker fleet. The options are either to convert second-hand Boeing aircraft or to opt for the Airbus air tanker. As the wings for the Airbus would be built in Broughton in my constituency, I could be accused of being somewhat biased in relation to that choice. I would contend that the Airbus is a far better long-term choice and offers a good possibility of further export orders. It is therefore the smart choice.
	We have a major job to do in promoting our own industry. The French Ministry of Defence rightly comes down on the side of the French defence industry. The French equivalent of the Department of Trade Industry believes that its role is to champion French industry, and our Government, Ministers and Whitehall officials must follow their example. We must support British manufacturing, the British defence industry and British jobs.
	The strength of competition from the United States defence industry makes it vital that British companies continue to play a leading role in defence manufacturing exports. In particular, they must play the leading role in making essential projects a reality through European partnership. We must also ensure that this country's skills and intellectual property are valued and invested in. Our defence industries are often the most highly skilled and high-tech in the whole of manufacturing industry. The skills, knowledge and intellectual property that we have built into our defence and aerospace industries have proven time and again to benefit our entire manufacturing base.
	In defence, we must not try to prop up lame ducks, but actively to support and encourage what are world-beating industries. Let us support smart procurement, but let us ensure also that we make the smart choice by supporting British manufacturers.

Desmond Swayne: It is a great pleasure to follow the hon. Member for Alyn and Deeside (Mark Tami). I cannot claim that I agreed with everything that he said, but I agreed with the greater part of it. He argued his case very cogently, and his defence of his constituency interests was a model for us all. I should at this point draw the House's attention to my entry in the Register of Members' Interests.
	The sixth report of the Public Accounts Committee, which was published last November, recognised the impressive achievements of our armed forces. However, it also observed that:
	Despite the considerable sums of money spent on defence equipment,
	our armed forces are
	still faced with using out-dated equipment and relying on other nations to provide elements of capability which should by now have been available to them.
	The report continued by expressing the hope that the equipment capability customer organisationwhich is responsible for deciding what is required, and for controlling the funding to deliver that capabilitywill offer a potentially significant step forward in providing the armed forces with the equipment that they need at the time that they need it.
	However, the conclusion to the report observes that there was considerable confusion
	between the Capability Customer and the Defence Procurement Agency over the fitting of a sonar to the first three Type 45 destroyers . . . The Committee finds it difficult to understand how the planning for these ships could exclude such vital pieces of kit and views with concern that such a possibility could have been seriously considered. The Committee therefore recommends that the Department should review the arrangements for communication between the Equipment Capability Customer and the Defence Procurement Agency to ensure that those arrangements can be relied on to convey exactly what is required.
	I wonder whether the Minister can say in his winding-up speech what progress has been made in implementing that recommendation for much better communication between the capability customer and the Defence Procurement Agency. If he is unable to do so, perhaps he might write to me on the matter.
	The report also states that, in the evidence presented to the Committee in compiling the report:
	The Chief of Defence Procurement said that the sonar was being procured because of the headroom provided
	by achieving a rather better price on the prime contract. That seems to imply that the sonar would not have been acquired, had such headroom not appeared in the main contract. I find that rather odd, and it stretches credulity somewhat.
	The Department has not always undertaken the right analyses at the right time. For example, it is generally agreed that the study on anti-armour weapons should have been carried out before committing the medium-range Trigat project to production, rather than after the project was withdrawn. In future, we would expect the equipment capability customer organisation to specify at the outset of such projects precisely when such studies should be undertaken.
	The Department's strategy for meeting anti-armour weapons requirements seems to have evolved over time with a general lack of coherence, and as a result a certain cost penalty has been incurred. For example, in the second order to upgrade additional BL755 cluster bombs for the Kosovo campaign, the unit costs were almost double that of the first order. Also, although the order for Brimstone missiles was reduced, that reduction failed to secure a commensurate reduction in the total spend. Additional Maverick missiles were purchased, at a significantly greater cost. I would expect the equipment capability customer organisation to provide a more timely forecast of the mix of weapons required, so that such cost penalties can be avoided.
	I have what the Minister might consider a dumb question about Eurofighter. It is perhaps dumb simply because I have no experience in these matters, but someone who lacks expertise in aviation matters should have such a questionwhich concerns the decision to remove the gun from Eurofighter, at a saving of 32 millionanswered for him. I am sure that a plausible scenario exists as to why we do not need that capability, but it gives rise to the question of why our partners in the Eurofighter project are persisting with arming the aircraft with that weapon. It also gives rise to the further question of why other countries continue to arm their aircraft with such weapons. In order to allay the fear that this is simply a cost-cutting exercise, it would be interesting to hear the Minister rehearse precisely why we have decided to do without that capability, given that other countries have decided to persist with it.
	I was always a fan of the SA80 weapon and a supporter of that project. As far as I was concerned, the greatest disappointment arising from it was the failure to deliver the weapon anywhere near the 1980 deadline that gave rise to its name. I have always regarded it as a sophisticated weapon and an amazing piece of engineering which, had we got it right at the startit is interesting to note that much of the recent upgrade consists merely of the production of the original parts using better materialswould have sold in large numbers throughout the world.
	I am concerned about the study that has just concluded of failures in Afghanistan. The Minister said that although the study has been concluded, he is awaiting the report. If the commercial organisation for which I worked before becoming a Member of Parliament had had a problem and dispatched a team to look into it, and if that team had returned and had a board meeting coming up, we would not have sat back twiddling our thumbs and waiting for the team to digest its findings and write its report; we would have ensured that we had a swift briefing, even if the report had yet to be written. The defence procurement debate is being held today and it would have been interesting to hear Ministers' comments about the problems in Afghanistan on the basis of their initial briefing on the issue.

Lewis Moonie: We do not have the information yetotherwise I am sure we would have been able to share it with the hon. Gentleman and others.

Desmond Swayne: I accept that point, but had I been the Minister I would have taken steps to ensure that I had the information before the debate. I would not have waited for the gestation of the report but would have insisted on a verbal briefing straight away.
	When the Minister winds up, will he address longer-term procurement and do a bit of blue-sky thinking? We know that our American allies are moving towards a capability for rapid deployment, which will involve very light, air-transportable armaments and armour. Are we intending to follow that lead? I understand that the rapid effects project was supposed to consider aspects of that technology. How is that requirement evolving? It seems to me that in any future conflict we will have to strike a balance between protection and deployability. That balance at the moment comes out at about 70 tonnes for armour. New technology will bring that down and enable a much more deployable armament that provides sufficient protection. Our American allies are considering that issue, but are we following their lead? Will we develop a procurement project along those lines in the future?

John Smith: I wish to raise a specific point relating to defence procurement that was touched on by my hon. Friend the Member for Alyn and Deeside (Mark Tami) and briefly mentioned in the two opening speeches. I was surprised that the mentions were so brief, because the area of procurement in question commands the biggest slice of the defence budgetalmost 6 billion in procurement and procurement support. It is surprising that it has hardly been mentioned this evening.
	As in all good debates among people who are passionate about and committed to defence, several points have been raised in this debate, and I shall respond generally to some of those before I turn to the main issue of my speech. The House may be surprised to learn that I think that tonight's debate is an historic one. Defence procurement does not excite everybodyit is not the sexiest subject for debatebut it has been proved tonight for the first time ever that the Labour party is the party of defence. If anyone was in any doubt about that, they can be sure of it after tonight's debate.
	We have had an admission from both sides of the House that this week has seen the announcement of a substantial real-terms increase in defence expenditure that will help our procurement programme no end in the near future. It is the biggest increase in defence spending in 20 years, and it comes on top of at least three successive years' worth of increases in defence expenditure, after the haemorrhaging that we saw in the last 10 years of the Tory Government.
	I remind the House that although the Tories cut the budget by a third in real terms, the way in which that was done is the real issue. There was a peace dividend after the cold war; but the way in which the Tory Government cut the defence budget left the country with enormous capability gaps. That is why I was a little worried when I heard the hon. Member for Aldershot (Mr. Howarth) say that ifGod forbidthe Tories ever returned to power, they would commit themselves to capabilities enabling us to fulfil our international responsibilities and defend the homeland. I would prefer to consider what they did, rather than what they say they are going to do. There were huge gaps. Heavy lift, for instance, was virtually non-existent by 1997as were the provision of medical support for our service personnel in the front line, and second-line defence logistics.

Mark Francois: Let me give the hon. Gentleman a chance to take a quick breather. I think it fair to say that because we are moving to a different system of MOD resource accounting and budgeting, we are to some extent comparing apples with pears. According to the analysis given by my hon. Friend the Member for Aldershot (Mr. Howarth), the figures are not as impressive as the Government suggest. I think we should wait for the Defence Committee to conduct a forensic analysis, as it does best. We shall then see whether the claims of the hon. Gentleman and his party are as impressive as they would have us all believe.

John Smith: The hon. Gentleman would want to wait, wouldn't he? Anyone looking at the Conservatives' record would say, You bet they want to dilute and undermine this Government's achievements in any way they can, because they contrast so well with their disastrous performance during their last 10 years in office. In those days, we were dangerously lacking in capability. We could not have met our NATO capability requirements by 1997 had we been called on to do so. If article 5 had been invoked, this country could not have delivered on that invocation. It was indeed a disastrous situation in which we found ourselves in 1997which is why Labour, beyond any doubt, is now the party of defence.
	As others will know, whenever Labour Members visit the officers mess, an officer will sidle upin general, the more senior the military brass the more likely the occurrenceand say, Of course you know, Mr. Smith, Labour has always been a great friend of defence. We will never forget what a brilliant Defence Secretary Denis Healey was. They always say that, even if they are 21 years old, and we sometimes wonder where they have got it from.
	To be honest, in the past I have never been particularly convinced by all that. But since the publication of the strategic defence review a year after the election of a Labour Government in 1997, there has been no doubt about it. That document has stood the test of time. It has given us the increase that defence deserves and needs this year.

James Gray: I am loth to interrupt the hon. Gentleman when we are all enjoying his speech so much, but the strategic defence review happened some five years ago. Even if he is right in his assertion, it has taken his party five years to fund that review properly. Can he explain why?

John Smith: I do not think it has taken five years. There has been a year-on-year increase, albeit small, and there is a substantial increase for the next three years. That must be compared with the massive and dangerous cuts that were made previously. We were able to do what we did because not only was the review inclusive and transparent, butConservative Members may not like hearing thisby and large, it garnered, bipartisan support. The books were opened. We were told to look at the current defence resources and at the change in the security environment and decide what action was needed. The fact is that most Members of Parliament agreed with the conclusions.
	I am a member of the NATO Parliamentary Assembly: I represent this Parliament in that august organisation. I am also a member of a sub-committee considering the future military capabilities of NATO members and aspirant members. The British strategic defence review is used as a model throughout those countries. I happened to be present at the NATO Parliamentary Assembly summit in Edinburgh when General Wesley Clark, then Supreme Allied Commander Europe, held up the review as a future model for defence forces throughout the NATO countries.
	We must not underestimate the strength and achievement of the SDR. Britain has put forward the money in the past, and we are still doing so. Tonight's debate is on procurement, and its emphasis in connection with the success of the SDR has focused on the reconfiguration of our forces to meet the changed security environment. Under the Tories, Britain was still defending itself against a non-existent enemy in the east, and we protected the plains of Germany with thousands of military personnel.
	The Territorial Army was mentioned earlier. The previous Tory Government cut its numbers by some 20,000, but those who were left were given a job that they would never have to do in the foreseeable future. That was not good for them or for British defence, and it was a waste of taxpayers' money.
	One of the most radical elements of the SDR often gets overlooked, and that has happened again even in this debate. That element is the review's proposals to improve procurement and defence logistics. As it happens, logistics takes up a bigger proportion of the defence budget than procurement. We tend to think of procurement in terms of fast jets, tanks and warships, but the real expenditure is devoted to lines of supply, servicing and keeping the bellies of soldiers on the front line full. I am not sure that the House spends enough time discussing that important matter.
	The changes in procurement have been extremely radical. In some respects, they are more radical than the changes in our force structures. My right hon. Friend the Member for Walsall, South (Mr. George), the Chairman of the Defence Committee, was right to say that nothing will happen overnight. We will be lucky if the task is completed in a decade, but the Government have attempted to tackle it and at least the oil tanker is starting to move in the right direction.
	The bureaucracy needed to cope with procurement and logistics is gigantic, as is the amount of money involved. The vested bureaucratic and military interests will take quite some time to change, but the indications are that things are changing. Reports from the National Audit Office, the Public Accounts Committee and elsewhere show that we are starting to move in the right direction.
	The Government have created the Defence Procurement Agency and the Defence Logistics Organisation, and have brought logistics together in tri-service provision. That may sound easy to do, but it is a different matter when one tries to tell the Army, the Royal Navy and the Royal Air Force and the rest that they will not act alone any more. That is a huge task even to consider taking on, which is why this important programme has been so radical.
	The savings, in terms of the reduction of waste, inefficiency and duplication, should be astronomical. We have heard of the cost over-runs with previous defence projects. I would like to be able to blame all that on the previous Tory Government, but such things have gone on for a long time. Projects can take eight, 10 or even 15 years to complete. It is very difficult to keep them under control, which is why the new agencies have been created.
	Smart procurement was introduced to speed up decision making, and that approach has now been extended to smart acquisition. The integrated project teams were introduced for the same reason. A concept borrowed from the Americans, they have proved very successful, not merely keeping an eye on a project as it comes on-stream, but throughout its entire life. The potential savings in that regard are huge.
	The Government have introduced a series of radical changes whose benefits will become clear to hon. Members of all parties. All the money saved and resources released will be devoted to front-line services. Our soldiers are the best in the world, and they will have the best equipment and resources to do whatever job they are given, be it in Sierra Leone, Kosovo or Afghanistan. That was the challenge set up by the SDR, and we must take it forward.
	The fact that we have only to write a new chapter to the SDR in the aftermath of what happened on 11 September last year shows how far-sighted the review was. Obviously, no one anticipated that there would be an international terrorist attack on that scale, and the tragedy will have to change our thinking. It is clear that we will have to be able to deploy rapidly and to carry out a multiplicity of different missions, from peacekeeping to war fighting. We will also, probably, have to be able to deploy forces at much greater distances.
	We must look once again at our homeland defence, because the threat could come from anywhere. It could come from an unstable country, rogue state or terrorist gang and could strike right at the heart of this country. We must be able to adjust to meet that challenge.

Jim Knight: I wholeheartedly agree with my hon. Friend. Does he agree that such is the strength of the SDR process that our armed forces are very well placed in terms of projection overseas and certainly in comparison with most of our NATO partners? In many ways it is a shame that our homeland security and our civil response to the new security threat are not as well placed as our armed forces are following the SDR process.

John Smith: I entirely agree with my hon. Friend. I am sure that we will revisit that issue during tomorrow's statement. I have to hand it to the Defence Committee, which warned of such an attack happening long before 11 September. However, we must be careful and distinguish between what we can realistically do to prevent such attacks and what we can do to manage their consequences. There is a difference between what we can realistically do and what we are seen to be doing. I am more interested in reshaping the footprint of British defence forces so that they can more readily identify with regions, local authorities and civil authoritiesthe police and fire servicesand prevent something from happening or respond after it has happened. We would do far better to look at that use of our resources than to create a huge new force like the Territorial Army. Frankly, between 1989 and 1997, the territorials were not quite sure what job they had to do.

Mark Francois: As a former Territorial Army officer, I should like to respond to the hon. Gentleman's remarks. Rather a lot of Territorial Army soldiers knew exactly what they had to do. They did not need their numbers slashed and the infantry battalions did not need their back broken by a Labour Government.

John Smith: The hon. Gentleman refers to the infantry battalions, the cap badges and the tradition. By and large, it is harder for Tories to take those tough decisions about reforming our military.
	The hon. Gentleman is rightit was an error on my part to say that all the territorials had nothing to do. That was nonsense. They occupied key positions in some of the world's trouble spots, including Bosnia. However, the majority were effectively cannon fodder for a non-existent enemy. That was the reality.

Ian Liddell-Grainger: I am also a former officer in the Territorial Army. I was in the Fusiliers, a northern regiment. I sat on a bridge on the River Weser month after month watching for Russian tanks. They may or may not have come, but we knew precisely what we were there to do and we knew how to do it. I hope that the hon. Gentleman appreciates that Territorial Army soldiers did a job for all those years and that they continue to do a job by serving around the world with the regulars.

John Smith: When the red army existed intact, that was an incredibly important and worthwhile job. Now that the red army has collapsed and could not possibly present a realistic threat in the next two or three decades, even if they started building up now, the job no longer exists. I am not casting aspersions on the role played by the territorials. However, the challenge in the SDR was to find them a realistic role for the future. Nobody wanted the territorials to have a valued and important role in the new defence structures, facing new and unpredictable enemies, more than they did.

Mark Francois: We have to thank the hon. Gentleman for recanting part of what he said earlier.

John Smith: If I gave that impression.

Mark Francois: He did, and we have acknowledged that. However, part of the debate about the Territorial Army is how it could carry out an operational role in home defence in the aftermath of 11 September. We hope that that will be addressed in the new chapter of the SDR. These are very important issues. I thank the hon. Gentleman for withdrawing his remarks but ask him to think more carefully about what he says.

John Smith: I am not withdrawing what I saidI want that on the record. My point did not appear to be made clearly enough. I am making exactly the same point, and I agree with the hon. Gentleman on future homeland defence requirements. However, there is no doubt that the traditional role of the Territorial Army has changed. There may be slight disagreement between the hon. Members for Rayleigh (Mr. Francois) and for Bridgwater (Mr. Liddell-Grainger) and me because I am an ex-regular and they are ex-territorials. That could account for our differences.
	I want to focus on the Government's extremely innovative policies in the Defence Logistics Organisation. As I said earlier, that represents one of the biggest challenges because it has the biggest budget and the greatest potential for cost savings so that money can be spent where we need iton the front line.
	In his opening speech, my right hon. Friend the Minister of State for Defence referred to private finance initiatives and partnership agreements. That is exactly the right way to go forward. The difference between the Labour Government and the previous Conservative Government is that we are not Treasury-led and, most important, we are not ideologically led. We are looking for the most efficient output and the best way of delivering serviceswhether public, private or a combination of both. That is exactly what we should be doing. Other countries are doing that, especially the United States. We can learn lessons from their experience.
	My right hon. Friend did not refer to the creation of the Defence Aviation Repair Agency, an innovative concept which was set up in 1999 to be given trading fund status as a wholly owned subsidiary of the Defence Logistics Organisation. The agency received that status on 1 April last year and by 1 April 2004 it will have a turnover of about 500,000 million. It will have a huge work force and will provide a one-stop shop for the entire deep repair and maintenance of almost all our military aircraft. In about two years, the agency will be a commercial organisation. It will receive money not from the defence vote but from clients who buy in its services. That was a courageous move for the Government and it is one of the ways forward.
	The project provides the surge capacity referred to earlier, but without complete dependency on the private sector. It also gives the Ministry of Defence another option if it wants to buy in services other than from private companies. God forbid that a private company should have the monopoly for the supply of those services. If that were so, I agree with my right hon. Friend that we should be in serious trouble.
	The agency offers several advantages. Although I have not offered uncritical support for some of the developments in that organisation, it has made enormous progress during the past two years. It has completely restructured the work force and removed whole tiers of management. It has changed the terms and conditions of employment and working practices. It has had to deal with unexpected reductions in demand, when it was not awarded contracts that it expected to receive. There have been unexpected cuts in DLO expenditure of which there was little or no notice.
	We have already discussed the Sea Harrier, but one aspect of that debate was not covered: the impact of withdrawing the aircraft earlier than planned on the supply line that services them and on the jobs and skills base that are dependent on such work and that are vital to our future military provision. The agency is preparing to adjust to that.
	As I noted, the agency was set up in April 1999; it was awarded trading fund status in April 2001 and will be a fully commercial organisation by April 2004, although it will still be owned by the Ministry of Defence. There are four sites in the United Kingdom, one of which is in my constituency at RAF St. Athan. It is vital to their success that the agency gets the go-ahead for a new purpose-built hangar at St. Athan, as part of one of the biggest aerospace projects in Walesthe red dragon project. The new hangar must be built before the organisation achieves full trading fund status in 2004 to allow it to compete on the open market with other private sector companies not only providing military service and repair but also offering a commercial service to civilian aircraft when possible. My concern is that if the go-ahead for the red dragon project is not given in time, we will not have the facilities to provide a modern manufacturing plant to compete with other players in the market.
	I understand that there was a meeting of the ministerial advisory board a week ago, and the expectation was that the go-ahead would be given for the red dragon project. That would have given permission to raise the money; it will be a private sector initiative to provide a purpose-built hangar that will take 47 fighter jets, and multiples of other aircraft, under one roof. There are hundreds of buildings spread over miles of land, most of which were built during the second world war. We cannot expect people to compete in those circumstances. The decision was not taken and there was enormous dismay and anxiety in my constituency, especially among the work force, who have worked so hard to support Government policy. There is anger and uncertainty about the future.
	If that hangar is not started by the end of this year, it will not be complete for April 2004, and the organisation that we created under a progressive procurement policy will not be able to compete in the open market; it will have one hand tied behind its back.
	Another reason why the Minister should consider this matter carefully is that by unnecessarily delaying the projectif it is delayed; I hope that my hon. Friend the UnderSecretary will say something tonight to convince me and the people who run the Defence Aviation Repair Agency that that is not the decisionthere is a danger of playing into the hands of those people within defence procurement, the Ministry of Defence and the military who do not want that solution. They do not like to see so much use of PFI or private partnering, or the creation of new commercial agencies. Naturally, they want to retain their empires and, where they can, build on them.
	The British military are the best in the world at fighting wars, but they are not very good at providing the back-up services, stores and support facilitiesI speak as an ex-service manthat, frankly, can be provided more efficiently and more cost-effectively in other ways. There are no military benefits from the work reverting back to the military, but there would be a lot of extra resources to go to the front line. Ministers must beware that they do not play into the hands of those who do not want to see agencies such as DARA, or private partnering, succeed. They want to revert to a failed policy.
	In many respects, the United States has led the world in new thinking and innovation in logistical support and procurement, but what the Americans say and what they do are often very different. The fact is that we have seen very little shift from military supply and support to private sector innovative provision in the US. The reason is that the lobby on Capitol Hill is so enormous that every time a Presidentwhether Clinton or Bushhad to sign something off, he would not do it. We do not want a parallel situation in this country, caused by a possible delay in a decision that should be taken now to allow the organisation to improve its quality of service, reduce its costs and compete on the open market by 2004.
	Red dragon will be one of the biggest aerospace projects in Wales, with an initial investment in excess of 100 million. The Minister may or may not be aware that the decision to delay the go-ahead for the red dragon project could blight that development and that site.
	DARA tells me that it has people ready to enter into partnership agreements. Perhaps more importantly, the chief executive of the Welsh Development Agency tells me that he has a number of clients queueing up to move on to the aerospace park. They are ready to make the project work, but they will not wait indefinitely and they may be lost. My right hon. Friend the Minister is aware of the change that is taking place at RAF St. Athan. All the staff are worried and waiting for the decision.

Adam Ingram: It is difficult in an intervention to deal with all the points that my hon. Friend makes, but I shall try to give him some assurance. He has been a very fierce campaigner for that project and has criticised some of the ways forward, and rightly so. The letter of intent has been signed. As the sole owner of DARA, I remain positive about the way forward. This is a question not of dithering, but of trying to obtain certainty. We are examining the best solutions. Rather than moving forward on the heads of agreement at the meeting last week, I thought it better to complete the internal examination, which is also taking place, of end-to-end support for the RAF, so that it can better advise me on my ultimate decision. I well understand the anxiety; it is a matter of regret, but I hope to be able to give an early answer, and the solution will not be long delayed.

John Smith: I am absolutely delighted with my right hon. Friend's intervention. What he says not only reassures me, but, more importantly, it will reassure the work force at RAF St. Athan and, indeed, the people of Wales, who look forward to the success of the project.
	This has been a good debate, and we have covered many procurement issues. I believe that the Government are moving in the right direction. In reality, if people scrape away at the surface, they will find that there is much more bipartisan support for what the Government are doing than Opposition Members will let on.
	I am sure that we are on the right path in trying to improve our procurement and logistics because of my experience some years ago, when it was decided that Defence Estates would simply carry out an audit of what the MOD owned in this country. No one had ever done that before. No one had ever sat back and asked, What exactly do we own and what is it worth? The audit was fascinating. I understand that it found 600 horses, but no one quite knew what they had been used for since the abolition of the cavalry. It found a string of diesel locomotives, rolling stock and land worth millions of pounds. All that money could be saved by a simple auditing initiative. I tell the Government to keep up the good work.

Ian Liddell-Grainger: First, I must apologise to the House for my slight, forced absence in the middle of this debate.
	I should like to talk about a very particular part of defence procurementthe procurement of explosives. There is one plant in this country that makes explosives to the standard and level that the British military needsthe old Royal Ordnance factory at Puriton in Bridgwater. It is important to consider this issue because procurement has not just begun but goes back over the ages. The point has been eloquently made that we are not very good at achieving some of our procurement aims.
	The factory began work in 1939, and it was located in Bridgwater because there is lots of waterit happens to be below sea level. By the end of 1941, it had produced 20,000 tons of high explosive. It is best known for the bouncing bomb and many of the other explosives produced in the early part of the war. Since then, it has created some of the best quality explosives in the world. It cannot be beaten by anyone. Those explosives are required for our bombs, shells, missiles and so on.
	The factory has been an exemplary employer and has done a phenomenal job. After privatisation in 1987 and because of the shrinkage in this country's defence capacity after the fall of the red armythe red perilit had to change. However, it is now under threat, but not because of what the Government are doingit was taken over by BAE Systems. If hon. Members want to boo and hiss now, they may. That is a company that has one aim: to maximise profits. It may sound as if I am speaking for the wrong side, but I agree that a company whose activities put the interests of a country at stake should not just aim for the largest profit that it can make. It is, so far, a British company, and the nation matters more.
	Royal Ordnance has a 400-acre production site. It is a large factory capable of producing high-quality explosives on a site that could be a world-beater. It is a site that is out of the range of people. It is in a safe place: that is why it was put there. It is also away from prying eyes. As anyone who has been involved in the chemical industry knows, it is easier to mothball a chemical plant than to shut it down. If one shuts it down, the land clearing and sterilisation of the soil is a massive expense. I hope that Ministers will take that on board.
	Puriton is now making RDX, TNT and HMX, which are explosives that we depend on for our military capacity. It also looks after other material that is vital to the defence of the nation, and that we cannot depend on the Americans to supply. Will the Minister address that point? Where will we get that extra material from if Puriton disappears? The United States Government have never said how we will obtain such material if it cannot be supplied from across the pondI felt that I ought to repeat that to the House.
	In terms of supply, from where will we get explosives for Sea Wolf, Spearfish, Sting Ray, BVRAAM and CASOMI do not know what they stand for, but they all need a warhead that has something in the end that goes Bang![Interruption.] I am a Territorial Army soldier; I know what out-of-date means. We are here to try to save a plant that has done a great job over 60 years.
	I received a letter from the Royal Ordnance trade unionsor from the Transport and General under Jack Dromeywhich stated that the Defence Committee pointed out that
	a long-term Partnering Agreement was concluded two years ago, which it hoped would provide the stability for Britain's Royal Ordnance factories
	but
	the Agreement 'has only served to give the firm the foundation it needed to close further plants'.
	That means all three remaining plants. It continued:
	The Defence Committee then calls on the MOD to act, saying that Defence Ministers 'must continue to monitor more robustly the implications of ammunition plant closures, and indeed other Defence Industry rationalisation to be ready to protect re-supply routes for such essential support for our Armed Forces'.
	It went on to refer to
	the closure of the remaining factory manufacturing high explosives here in Britain . . . That vital and strategic capability should be preserved.
	What is at issue? We are talking about the ability of our country to survive with our war stocks for up to 30 dayswe need to be able to keep a division operational for 30 days. If the war stocks are not there, and they have to be bought from elsewhere, the defensive and offensive capacity of the nationits ability to go to war and to protect itself or its citizensis potentially undermined.
	One of the biggest problems over the last few years has been the moving of explosive production out of this country to Germany, America and elsewhere. I shall deal with the American situation in a moment. One of our ammunition plants was closed to remove production to Germany. The Select Committee said that, unless we ensure that our war stocks are safely maintained at the necessary height, we will not be able to resupply in the short term. One can never set out what an emergency will be, as has been eloquently explained in the House by hon. Members. One can never foresee the unexpectedthat goes without saying.
	The three remaining plants are at Chorley, which does mostly civil work but makes the detonators and initiators, at Bridgwater, which produces high explosives, and at Birtley in the north-east, which assembles the shells and shell cases. We will lose all three plants if BAE Systems has its way.
	One of the problems of the Bridgwater plant is that it has never had its own cost base. That may sound strange, but BAE Systems has always made it a part of other loss-making plants in this country. I refer not only to the ones that we know about, but to Glascoed and others. If a plant cannot prove to BAE Systems that it will make money, BAE will view it in a different way. If the plant was given the chance to be a cost-effective unit in its own right, it could prove that it could make money, as it continuously did when it stood on its own two feet for many years.
	I asked the Under-Secretary what the Government's policy for ordnance production in the United Kingdom was. I was told that the MOD had
	entered into a 10-year Framework Partnering Agreement with Royal Ordnance Defence, the United Kingdom's major producer of munitions. This agreement provides the company with a schedule of business and visibility of MOD's potential future requirements such that the company can provide the MOD with munitions at world benchmark prices.[Official Report, 15 July 2002; Vol. 389, c. 20W.]
	I do not think that that is correct. If BAE Systems uses that benchmark, it can move production of ammunition to anywhere in the world. There would then be no guarantee that we could obtain ammunition from where we want it or when we want it in an emergency.
	Lord Bach said that, if Royal Ordnance had not entered into such an agreement towards the end of 1999, the position would have been so bad that the future of the plants would have been under serious threat. I have raised this matter with the Under-Secretary before, and he rightly raises his eyebrows. However, I shall bang on about it until we go blue in the face.
	The Holston military ammunition plant in Tennessee is on a site of 6,000 acres and it is the largest bomb-making factory in the world that is run by the British. It is now controlled by BAE Systems. Royal Ordnance has just been granted $163 million to run the plant, and it is looking to bring in world-beating products from all round the world. It has been given a 25-year extension to the contract to be able to do that, so this is its chance to use its muscle and the framework agreement set up with the MOD to move the production of ammunition to an American army plant in Tennessee.
	The plant now has contracts worth $88 million for the production of the RDX and HMX explosives. That is strange, because those explosives are produced in this country. The different types produced at the American plant are now being used in British warheads. A further $75 million contract will give Royal Ordnance the right to a 25-year exclusive contract to bring in production from around the world.
	Because we have signed the Ottawa convention, we have signed away our right to produce land mines. That is fine, but the American plant makes land mines. Does the Under-Secretary think that there is a contradiction if we buy ammunition, stores and facilities from a place that produces land mines? Are we not in breach of the convention that we signed? I ask the question, because I do not know the answer. I saw the effect of laying land mines when I sat by the Weser looking for the red peril.
	I was a member of the Territorial Army, but now look at it from another point of view. It provides, and still provides, a battlefield replacement ability. It has been involved in the Gulf, Bosnia and most other places where the Regular Army has been. It will continue to do that. However, it has always faced the problem of obtaining the same equipment, training and back-up as the Regular Army. That creates problems, because the Territorial Army does not have the time to train soldiers unless there is a long run-in to an emergency. Emergencies tend to happen quickly these days and there is little or no preparation time to get our territorial soldiers up to a standard that allows them to replace units or participate as battlefield replacements. The same goes for replacements for engineers, doctors, nurses and any specialist. The majority of TA specialists look after 155 mm guns and many other things that the Army does not keep a corps to do. If we lose that capacity because people are not trained, that procurement system will disappear. We should encourage members of the TA to continue to perform that role.
	I have just finished a book by Peter Hennessey, an academic, on the role of Whitehall from world war two to the end of the cold war. He argued eloquently that it is not possible to be over-prepared for civil defence. I suspect that we did not get it right in this country, but we never had to find out. We need to examine the future of home security much more closely. That means knowing about procurement and security and understanding where, say, ammunition comes from because we have only one chance to get it right.
	I urge the Minister to defend the factory at Puriton. It is important to have a secure supply of ammunition. We must learn the lessons from the Gulf war when the Belgians would not give us ammunition. Those problems have not gone away. It only takes America to disapprove once and we will not get what we need to do the job of defending this nation.

Kevan Jones: I declare my membership of the GMB trade union and draw the attention of the House to my entry in the Register of Members' Interests on the support that it gives to my constituency party. Some of its members work in the defence industry.
	I am proud of this country's defence industry and the number of jobs that it creates, not just in the north-east of England, but throughout the country. As my hon. Friend the Member for Alyn and Deeside (Mark Tami) said, those are high-quality jobs. The defence industry helps to ensure that technology is at the forefront of developments.
	Like my hon. Friends the Members for Alyn and Deeside and for Dunfermline, West (Rachel Squire), I welcome last week's increase in defence expenditure. It will have a major impact on procurement by the Ministry of Defence. That is important to our defence industry, which is right to be proud of its exports record. We need to defend those exports because they are key to a vibrant and important sector.
	Ministry of Defence procurement is crucial because it provides the bedrock business for a range of defence manufacturers. Defence manufacturing now operates across nations, as the Minister said. There are few sole suppliers from one country. Manufacturers work together to put sophisticated programmes in place which are important to us and our European allies. However, it is important to defend UK jobs, and the Ministry of Defence should ensure that jobs are retained within the UK defence industry. It is a matter not just of the number of jobs, but of the skills that they require. Skills cannot be turned on and off like a tap they need to be nurtured over a long time. The defence industry needs a continuous supply of work so that skills can be retained and nurtured.
	On the procurement of warships, the Minister said that competition is a key part of defence procurement, including naval procurement, which I accept. It is also about getting value for money.
	I refer to comments that Lord Bach made to the Scottish Affairs Committee during its investigation of employment in the shipbuilding industry on the Clyde. He stated:
	All fighting vessels are built in the UK.
	He continued:
	it remains the policy of this Government that all warship construction will continue to be carried out in this country.
	Therefore it gives me no pleasure to raise the issue of the advanced landing ship logistics at Swan Hunter, where a large amount of work that could have been carried out in this country has been subcontracted to Holland. Again, in evidence to the Scottish Affairs Committee, an MSF full-time official said that he believed that up to 40 per cent. of the work on the ALSLs has been contracted abroad to Holland.
	I raised the issue last November in a parliamentary question for written answer after defence contractors in the north-east told me about their difficulties in getting on tender lists for Swan Hunter. The Scottish Affairs Committee report states:
	Lord Bach admitted that whilst there was no intention to contravene the Government's military shipbuilding policy, in this case the overseas fabrication of the hulls did raise questions about compliance. Following an agreement with Swan Hunter (Tyneside), a clause has now been placed in the ALSL contract which requires MoD sanction before fabrication or assembly can be sub-contracted overseas.
	I would like to know why that was allowed to happen, given that there was a clear concern in the north-east, which I raised with the Ministry of Defence in November. Shipyard workers in the north-east who could have done that work to a high specification are very angry that they have not been given the opportunity to do so.

John Burnett: The hon. Gentleman makes a brave and compelling point. Does he agree that the issue is not only subcontracting to companies in Holland, but the fact that those companies further sub-subcontract to countries such as Ukraine, which have no regulations on health and safety in the workplace and which, unlike our shipyards, have significant subsidies available to them?

Kevan Jones: I am not aware of such arrangements, but I view them with great concern. It is clear that when Mr. Yap Kroese tendered for the contract in the first place, he fully intended to subcontract the work to Holland. I feel that we in the north-east have been let down. I, and many others, have argued for procurement of warships in the north-east, but I am sorry to say that people will be left with a bitter taste in their mouths if every time we successfully persuade the Government to procure contracts for Swan Hunter shipbuilders, that work is subcontracted to Holland. The MOD and the north-east shipbuilding community must make a clear commitment to ensure that work that can be carried out in the north-east is carried out there. I understand that time is limited, so I shall finish. I look forward to the Minister's response.

Jim Knight: I gather that I have only a brief period in which to speak, so I shall keep my remarks exceptionally short. I shall pass over my strong support for the increase in defence spending that was announced on Monday and go straight to key issues for my constituency.
	As I mentioned in an intervention, those issues include the consolidation of the Defence Science and Technology Laboratory in Hampshire, with a move away from its current site in Windfrith, where sea-systems expertise sits alongside a great concentration of expertise in the commercial sector. Although I appreciate that DSTL wants to keep some distance between itself and the other half of what used to be the Defence Evaluation and Research Agency, the discrete nature of sea-systems expertise means that the DSTL's continued presence in Windfrith would be a gain for the country as a whole.
	While I am talking about my constituency interests, I should say how enthusiastic people in Dorset are about the idea that when the next set of Type 45s are named, HMS Dorsetshire might be revived, following its excellent record over many incarnations. Last time we lost HMS Dorsetshire, the public in Dorset raised the money for its replacement, but unfortunately it was not built and the money had to be returned.
	The other point that I want to make relates to international partnerships in procurement. My hon. Friend the Member for Alyn and Deeside (Mark Tami) mentioned the A400M, and I have been privileged to visit the factory in Filton to discuss its importance with the trade union and management sides. I am therefore less than impressed by the fact that our colleagues in the Bundestag are delaying the procurement of the A400M and the Meteor, and I should be interested to learn what efforts the Government are making to put pressure on the German Parliament to make that decision. I agree with my hon. Friend the Member for Dunfermline, West (Rachel Squire) that we should not rely solely on the United States as regards the future of our defence industry. It is very important that we have a successful European industry, so we have to make such projects work. We must also encourage our partners in Europe to give us the same access to their markets as we allow them to ours. I am sure that Ministers will do that.
	I support a strong defence industry with properly regulated exports. I look forward to seeing the recommendations of the Quadripartite Committee in its report to be published tomorrow, but I am confident that a strong defence industry is getting stronger thanks to the policies of the Government.

James Gray: The hon. Member for South Dorset (Jim Knight) is very understanding towards one or two hon. Members who squeezed his time. I agree that it would be nice for an HMS Dorsetshire to be reinventedand an HMS Wiltshire come to that. Perhaps he and I will live to see it. That said, Wiltshire is one of the most inland counties, so HMS Wiltshire is less likely than HMS Dorsetshire.
	We all welcome this annual opportunity to examine in detail Defence Ministers' brave efforts to demonstrate that they have won the battle with their colleagues at the Treasury and their brazen claims that they are ready to supply, in plentiful quantity, the matriel necessary to carry out their ever more grandiose military ambitions. Unfortunately, they have once again singularly failed to persuade us that they are ready and able to do so. It is true that this week the Chancellor of the Exchequer sought to correct the impression that defence is the lowest of his personal priorities. In six years of speechesone can check it on the internethe has rarely mentioned the word defence, and he gave it no priority until now. He says that he has made a generous contribution towards defence, and we welcome that gesture.
	As the Chancellor's neighbour, the hon. Member for Dunfermline, West (Rachel Squire), rightly and memorably said, however, figures are subject to political bias. We fear that in this case the figures may well be biased against defence, and we will examine them very carefully indeed. It has been said that only one person understands defence budgets, and he died some years ago, and it will take us some time to determine exactly what they mean. In his contribution, the hon. Member for Yeovil (Mr. Laws) amply demonstrated that he does not know what they mean at all. We will look carefully at the figures and examine the bold claims that the Chancellor made, which were echoed by many hon. Members this evening. As is so often the case with the Chancellor of the Exchequer, I am afraid that the outcome will prove to be a great deal less beneficial to defence than he would have us believe.
	The Minister may like to clarify an important point that was touched on earliernamely, that as of April 2003 he will have to include in the budgets figures of 6 billion for depreciation and of 4 billion for carrying costs. He must tell us which Ministry of Defence budget that will come from and how it was taken account of in the comprehensive spending review. I understand from several people who know about such matters that that detail has not been thought through at all carefully. I challenge the Minister to explain, in very simple terms so that even I can understand them, exactly how depreciation and carrying costs were taken account of in the CSR. Defence accounting is a murky area, but we can be pretty certain that the Chancellor has been less generous than he would have us believe. The reality remains that the procurement bow wave is bearing down on us even more threateningly, and the CSR has done nothing whatsoever to reassure us about that.
	The hon. Member for Vale of Glamorgan (Mr. Smith) made the bold assertion that Labour is now the party of defence. I fear he may have undermined that by his absurd and ignorant attack on the Territorial Army. I suspect that the TA will not accept his assertion; we shall ensure that Territorial Army volunteer reserves throughout the nation are aware of his precise words.

John Smith: Will the hon. Gentleman give way?

James Gray: I do not have time. The hon. Gentleman had 40 minutes, which meant that several Labour Members could not contribute to the debate. I shall not therefore take an intervention from him.
	A well-known company of Scottish lawyers, McLay, Murray and Spens, who have offices down here, are known colloquially in Scotland as Delay, Worry and Expense. I fear that that epithet characterises the Government's defence procurement programmes. That is shown in a variety of current programmes for the Navy, the Air Force and the Army.
	Let me begin with some of the RAF procurement programmes. Several anxieties were expressedfor example, by my hon. Friend the Member for New Forest, West (Mr. Swayne). We are disappointed by the delay in Eurofighter and concerned that the Government cannot manage more than a general commitment to it. As the hon. Member for Yeovil pointed out, we need to be sure about the third tranche of Eurofighter if we are to maintain our reputation as worthwhile designers and a leading force in fighter aircraft development. The third tranche will be different from the first tranche, and we need to be sure of the former.
	As my hon. Friend the Member for Aldershot (Mr. Howarth) pointed out, the other great European project, the A400M, may be in difficulties if German constitutional law means that Germany cannot sign up to the 73 aircraft at least until after the general election. How long will Ministers stick with the deal? Seven thousand jobs depend on it. Many are in the west of England, and my constituency is affected.
	Perhaps more importantly, what thought have the Government given to an alternative stratagem if the A400M fails? Have they considered, for example, a C-17 with British engines? It would be interesting to know about discussions that Ministers have held with manufacturers about an alternative to the A400M. My constituents in Lyneham need to know urgently where the A400M or its replacement will be based, and what constitutes the future for Lyneham. Two thousand five hundred military jobs, 750 civilian jobs and 75 million depend on it. We look forward to the Minister's early response to the current studies.
	The future of strategic air tankers is also the subject of delay, worry and expense. When will the Minister announce which of the two remaining tenderers will be given the contract? Will he make a commitment about the in-service date? We are excellent at air-to-air refuelling, as the Afghanistan experience showed. We need to know that we can continue to offer that capability to the world. We cannot afford further slippage.
	Delay, worry and expense apply to the Royal Navy in the context of procurement. It would be useful if the Minister scotched the rumours that the operational fleet is to be cut further. He could begin by allaying our fears about Astute class submarines. In a reply on 9 July to my hon. Friend the Member for North Essex (Mr. Jenkin), the Under-Secretary said that HMS Astute was not scheduled until late 2006 instead of the original date of 2005, and that that would be followed by extensive work-ups.
	When the programme was set out in 2001, the MOD said that the Astute class would be built in 69 months. Does the Under-Secretary's reply mean that the target will not be achieved for the other boats? If so, does the Minister accept that Artful and Ambush are likely to be similarly delayed? Will he therefore reconsider the decommissioning date for S and T class boats, which they replace? If not, we will face a cut in our submarine fleet, from 12 to six boats. That is unacceptable, and would prove devastating for our defence capabilities.
	My hon. Friends the Members for Rayleigh (Mr. Francois) and for New Forest, West, and the right hon. Member for Walsall, South (Mr. George), said that there was genuine anxiety about the Type 45 programme, which is showing signs of slippage. Will the Minister give us an absolute assurance that there will be no further slippage in the programme, and that the six vessels will meet the in-service date of 2007? If not, will he accept that he leaves the fleet bare of air defence for an unreasonable time because of the Government's demonstrably foolish decision to withdraw the Sea Harriers prematurelya decision to which so many hon. Members referred?
	Incidentally, we hear that an American committee is to visit the UK shortly to assess what help we are to give the Americans with regard to ballistic missile defence. They view the Type 45 as a possibly suitable platform for our contribution to BMD. I know that that would not be popular on the Government Benches, but none the less it sounds as if it is being talked about.
	I asked the Minister about the matter in a written question, and the reply that he gave was quite interesting:
	The type 45 destroyer has been designed with substantial weight and space margins to enable its capability to be upgraded through life.[Official Report, 16 July 2002; Vol. 389, c. 158W.]
	I asked whether the Government were thinking about it for BMD, and he signally refused to say that they were not doing so. I therefore ask the Minister today to tell us if he is discussing with his American counterparts whether Type 45s might be used for BMD.
	Before the Minister says that no decisions have been taken on BMD, I draw his attention to an interesting brochure that I received this week for a conference about ballistic missile defence. The first speaker is to be none other than Group Captain Adrian Parrish, the ballistic missile defence capability working party chairman in the MOD. He is to be helped by a Mr. Philip Price, the BMD capability working group secretary in the MOD. So there is plainly a substantial part of the Department working on BMD. We need to know whether the Type 45s will be used for that defence programme.
	A further programme that it seems is to be delayedpossibly damaginglyis the one for the landing platform docks. I have even heard rumoursI am sure that they are incorrectthat Fearless may have to be brought back into service in order to make up for the delay. Will the Minister take this opportunity to reassure us about the future of Fearless?

Lewis Moonie: Scrap.

James Gray: I think that the Minister will find that he is quite incorrect in saying that. I have it on very good authority that the Brazilians have been crawling all over the ship for some time with a view to buying it for the Brazilian fleet. It is widely rumoured that the Brazilians do not need any LPDs and that the nation that does is Argentina. Will the Minister make plain today that he will put into any contract with the Brazilians a clause that states that the ship may under no circumstances, and at no time ever, be sold to Argentina? It would be an insult to the memory of the 225 service men who died in the Falklands campaign if Fearless were to land up in Argentina. We demand of the Minister an absolute assurance that he will take steps to ensure that that does not happen.
	We could go on endlessly about the threats to our naval capabilities, but I would rather rest my case on a quotation from none other than Warship World, an outstanding magazine which most Members present will know well. This week's editorial states that the Royal Navy
	stands poised on the brink of fundamental change, which if embraced, we feel will be the beginning of the end of the RNas we all know it . . . How many old salts turned in their graves to see Her Majesty sail in a Minehunter from Whale Island to the Old Vernon site (now a shopping centre) reviewing the handful of available ships? Does anyone really believe that no Fleet Review was planned as HM 'didn't want a fuss'. Let's be clear about itthere were insufficient ships to review . . . The writing is on the wall. The equation of commitments, assets, cash and manpower is always hard to juggle but it must be addressed if this island nation is to continue to operate an independent navy.
	It has been interesting to hear several Members trying in this debate to justify the withdrawal of Sea Harriers by saying that we will never go to war on our own. That argument could be used for any capability or any procurement programme. One could say, Don't worry, chaps. We'll rely on the Americans. We on the Opposition Benches believe that the Falklands and a number of other wars demonstrate that we need to be ready and able to go to war if necessary. The withdrawal of the Sea Harriers makes it extraordinarily difficult to be so. Warship World seems to be saying that unless this Government get their procurement act in order, we will not have a Royal Navy as we have come to know it and love it.
	The same problems of delay, worry and expense apply to the Army. We have heard a lot about the SA80 that is disturbing. Will the Minister clarify the tests conducted recently in Bagram on other rifles, and say whether, if they show that they are better, he will undertake to scrap the SA80 and replace it with something else? He is right to say that we must not allow our rhetoric to undermine the reliability of the main weapon that our soldiers use.

Adam Ingram: You have done a good job of that.

James Gray: The Secretary of State is quite wrong. I have always been a great supporter of the SA80; I have used it quite extensively. None the less, if his Government choose to take us into Iraqit appears that they are talking about 20,000 or 25,000 soldierswe need to be certain that the tests conducted in Bagram have demonstrated that the SA80 is a serviceable and useful weapon. The Minister must come to the Dispatch Box this evening and tell us what he is going to do about the outcome of that.
	My hon. Friend the Member for Bridgwater (Mr. Liddell-Grainger) highlighted some very worrying issues relating to the rundown of the Royal Ordnance factories, and to the problem with the accounting systems which means that we cannot now keep as large ammunition stocks as we used to. If we are to face any kind of major conflictI have mentioned Iraq, but there could be all sorts of otherswe ought, at the very least, to have a decent quantity of usable ammunition in this country, and to be able to keep some kind of capability to manufacture the stuff here. We have handed that capability over predominantly to Belgium and South Africa, and that is a disgrace. What are the Government going to do to ensure that Royal Ordnance is able to continue to manufacture ammunition, against the eventuality that we may go to war against somebody with whom Belgium and South Africa do not agree that we should go to war? It is important that we should be able to say to our people, You can have the ammunition that you need.
	Delay, worry and expense seem to typify the Government's occasionally haphazard and sometimes incompetent approach to some aspects of the procurement of the matriel that our service men need to carry out the ever more demanding tasks being asked of them. Like the hon. Member for Dunfermline, West, I pay tribute to the superb engineering skills that we have in this country, and to the great ability that we have to produce the matriel that we need. I suspect, however, that the Government are not taking the best advantage of those skills and abilities, or doing what they could be doing to promote them or to ensure that we keep them. Indeed, in some areaswe have mentioned ammunitionthey are allowing them to be run down.
	Despite the Government's brave words about the comprehensive spending review, the fact remains that they are not spending enough money to avoid the awful procurement bow wave that is approaching us. This week's announcement, although welcome, will do little to address the problem if, as is widely predicted, the Prime Minister moves inexorably, despite his own party, towards some kind of conflict with Iraq. The truth is that it is the Treasury that is running the defence of the realm, not Ministry of Defence Ministers. They are not even clever enough to make a decent fist of the inadequate resources with which they are provided. That is not a sensible way of running the nation. There is an eerie echo of the 1930s here, in that the Government are ostrich-like in their determination to do little about our defence capabilities, despite the ever-gathering clouds of war. Let us hope that that is where the similarities end.

Lewis Moonie: Just before the start of this debate, the hon. Member for North Wiltshire (Mr. Gray) accused my right hon. Friend the Secretary of State, presumably unintentionally, of having misled the House. I would like to set the record straight. There was no contradiction between the two answers that my right hon. Friend gave. The first referred to his support for company proposals to supply new warships to Thailand. The second quite rightly stated that the Government of Thailand had expressed no formal interest in the purchase of ex-Royal Navy warships. Those two answers, while difficult to understand for a bear of very small brain, are not incompatible at all.
	I shall try, in the time remaining to me, to get through as many of the points that have been raised tonight, some of which are, I have to say, rather old chestnuts. Let me start with the budget. I accept that budget figures are difficult for people to understand. I find them difficult to understand myself, but I was helped by spending two and a half years running the finances of the House of Commons, when I was Chairman of the Finance and Services Committee, during which time I learned to read a budget.
	The spokesmen for the Liberals and for the Conservatives both made the mistake of comparing outturn figures with budget figures; the two are quite different. They are different in defenceas opposed to virtually any other Departmentfor one special reason, namely the operational requirements that the Ministry of Defence has, over and above the fixed costs that we have to bear anyway in terms of paying our people their normal income.
	Operational needs are paid for out of the contingency fund, so the outturn figure rightly indicates what we have spent during the year. It does not express what our budget was. For example, last year, something over 1 billion was added into our budget figure. I cannot remember the exact figure, but if any hon. Members wish to know it, I would be happy to write to them. That figure must be stripped out before comparing last year's budget with a future budget. I am not trying to make an I'm clever and you're dumb point; indeed, I did not understand the matter myself until it was properly explained to me. However, the fact is that the money in question is real money that will be coming into the budget over the next three years.
	I should point out in passing that it is also important to recognise that, because so much of our budget is spent on capital requirementon procurement, the subject of today's debatethe sum is a real sum that is available each year. Obviously, if something is bought in one year, it has been paid for; it is not necessary to pay for it in the second year as well.

David Laws: I accept entirely the point that the Under-Secretary makes. He was correct in saying that the 200102 figure was inflated by a transfer from the reserve. However, he seemed also to accept the simple statistical point that I was making, and which emphasises how tight his budget is: it remains true that, in real terms, his Department's planned spending figures for the whole of the period of the spending review are lower than his Department's spending for last year. Is that correct?

Lewis Moonie: The planned total does not include unforseen items. [Interruption.] Of course it does not. If one strips out the 1 billion, a fair comparison can be made.
	It is an old trick on the part of people who think that they know a wee bit about statistics to use percentage terms when it suits them, instead of real figures. Speaking as a statistician of some merit, I should point out that using percentage figures to argue that the Department of Trade and Industry is getting more money than us is of course incorrect, given that its relatively small budget is some 5 per cent. of ours. I have not got the figures in front of me, but from memory the DTI's real increase is about 175 million a year. Our real increase, however, is 725 million for the first year. In real terms, that is four times as much, and of course, it buys four times as much.

David Laws: Will the Under-Secretary give way?

Lewis Moonie: No, sorry, there is no time; I have given the hon. Gentleman his chance. We will see how much that money can buy as we develop our spending plans over the next few years. In his statement tomorrow, my right hon. Friend the Secretary of State may well give some indication of the direction in which we will go.
	I shall try to dispose of a couple of old chestnuts, the first of which concerns the SA80. Let us be clear: every rifle misfires at one time or another, and in difficult conditions all rifles misfire more often than they would otherwise. I happily admit that the SA80 took a long time to introduce. There is no doubt that it is a very high-tech, excellent rifle. Any decent marksman will say that they would as soon use the SA80 as any other rifle in service, because they know what the result will be when they fire it. Those who are not interested in achieving a specific effect can use any rifle, no matter how poor its tolerances, to spray bullets all over the place. However, that is not what we use the SA80 for.
	As anybody who has served in our armed forces knows only too well, the SA80 is an extremely accurate rifle that is reliable in all conditions. The modifications were tested in Kuwait, which has very similarif not identicalconditions of heat and dust as those in Afghanistan. The rifle performed admirably under those conditions, which is why we have such difficulty in coming to terms with the fact that it failed to work in Afghanistan. For that reason, I will not make a premature announcement about the findings; we must wait until we have them at our disposal, and until a full and proper examination has taken place. We want to get to the bottom of the matterafter all, we have spent extra money on the SA80. We have what appears to be an excellent weapon at our disposal, and we hope that that will continue to be the case. However, I cannot make any predictions as to its future. Let us wait and see.

Gerald Howarth: Will the Under-Secretary give way?

Lewis Moonie: No, I really do not have time to give way.
	The question of the Sea Harrier comes up time and again, so let me deal with it briefly. We must remember that the risk involved in upgrading the Sea Harrier is high, by which I mean that the risk of not being able to upgrade it is high. We must remember the need, under the strategic defence review, to retain an offensive capability. Nowadays, carriers are used for projecting force. We must also remember that every spending decision involves an opportunity cost: if the money is spent on one thing, it cannot be spent on another. We must further consider the very wide range of threats to which a carrier and any other surface vessel is subjected, only one of which is air attack. As has been pointed out, the Sea Harrier is of absolutely no use against sea-skimming missiles, which are the main threat to a ship. Of course, the Phalanx system with which carriers are equipped is specifically designed to allow for that threat.

Gerald Howarth: Will the Under-Secretary give way?

Lewis Moonie: I am afraid that I have no time to do soI am trying to cover all the points.
	We are concentrating on force projections and the advice from the services has been that, on balance, we should phase out the Sea Harrier. We must remember that the choice is not between upgrading the Sea Harrier successfully or getting rid of it. The chances are that any upgrade would fail. Not only would we then have to phase out the Sea Harrier anyway, but we would also have wasted money on the upgrade. The services are right in their advice that, on balance, it was better to carry the small additional risk of operating without the Sea Harrier for whatever period that was necessary. That was their advice: they are the professionals. I am more inclined to take their advice than that of Opposition Members or, for that matter, of my hon. Friends.

Several hon. Members: rose

Lewis Moonie: I really cannot give way. I do not have time. [Interruption.] That is a silly thing to say.
	Let us dispose of the argument about the cannon once and for all. The minimal operational utility of the Eurofighter gun is outweighed by its support, fatigue and training cost implications, especially bearing in mind the historical pattern of operations over the last decade and the improved capability of the advanced short-range air-to-air missile with which the aircraft will be armed. There is no need for a cannon. The ASRAAM will perform adequately in close combat.
	On the issue of sonar, it is true that in 2001 the PAC questioned the chief of defence procurement and the deputy Chief of the Defence Staff about the logic of sending the first Type 45 to sea without a sonar, as that would limit the deployability of ships. At that hearing, they stated that it had already been decided shortly before that the sonar would be fitted on build to all Type 45s. The prime contractor announced on 18 January this year that it had selected Ultra UK as the preferred supplier of the medium frequency sonar. Ultra will build the sonar and take full responsibility for integrating it on to Type 45s. The contract has been let and the sonar will be fitted to the ships.
	The issue of Swan Hunter was raised on a couple of occasions. Our policy that warship building should be conducted in the UK remains in place. It follows that we would have preferred Swan Hunter not to subcontract the build of the bow sections abroad, but we should put that into context. The work constitutes some 4.5 per cent. by weight of the hull. We have now incorporated a clause into the ALSL contract that prohibits the company from awarding subcontracts for fabrication or assembly work on the hulls without the prior consent of the MOD. That clause will also be incorporated into all future shipbuilding contracts. We would allow fabrication or assembly work on hulls to be subcontracted abroad only in exceptional circumstancesfor example, if no domestic supplier were physically able to carry out the work.
	The Defence Science and Technology Laboratory rationalisation is an important issue, and the organisation forms part of my departmental responsibilities. It is an MOD-owned agency whose purpose is to provide world-class scientific and technical advice to us. I have accepted the arguments from management at DSTL that considerable benefits will accrue, both in the quality of research done and in costthat is important, because if we spend money on maintaining more sites we have less to spend on research. If we concentrate on three main sites, clear benefits will be felt from bringing our scientists together, in terms of creating new synergies, and from operating efficiency. The proposals have been the subject of consultation with staff at all stages and are now under consideration by the trade unions. We believe that the proposals will ensure the long-term future of DSTL and the best value for defence.
	My right hon. Friend the Member for Walsall, South (Mr. George) suggested that the Conservatives were following Frank Allaun's defence policy, and I found that amusing. To be honest, on probably every occasion that they cut the defence budget a Labour Member could be found to say that it had not been cut enough, so we should not go too far down that road. However, my hon. Friend the Member for Vale of Glamorgan (Mr. Smith) made the point that some of the Tory cuts might have been made more cleverly.
	Hon. Members mentioned delays with Astute. We are deeply concerned about those. We have continually moved from one pattern of submarine design to another, and design problems have caused these delays. We will do all that we can to return the programme to schedule, but it is only fair to say at this stage that Astute's entry into service may well take place later than the time indicated. We have left the manufacturers in no doubt about our concern, and I know that they are working hard to remedy some of the damage. Presumably if there is a gap in capability, we will have to see what can be kept going. It is difficult to envisage keeping the S class of submarines going much beyond their present lifetime, but there is capacity in the T class.

Mark Francois: Will the Minister give way?

Lewis Moonie: Very briefly.

Mark Francois: The Minister said that if there was a gap in capability, we would keep capability running. If that applies to submarines, why does it not apply to Sea Harriers?

Lewis Moonie: Again, I suppose that the reason is the balance of risk, and we must consider the balance of risk when making decisions such as this. We three Ministersfour if I include Lord Bachare not perverse people who sit down and say Just how are we going to cock up the armed forces today?. I apologise for the language, Mr. Deputy Speaker. In fact, we act on the advice of some very senior people, and I have yet to leave a meeting with the feeling that that advice has been wrong. We must not assume that upgrades will succeed; they may fail, and that is the great problem with the Sea Harrier. We might end up spending a great deal of extra money without having an aircraft available.
	My hon. Friend the Member for Dunfermline, West (Rachel Squire) rightly pointed out that we need equipment that works. I assure her that any defence Minister would heartily agree. She gave the example of Bowman, which, as everyone knows, has a long and sorry history but now appears to be on targeta very challenging target. I acknowledge that that was welcomed by the hon. Member for Aldershot (Mr. Howarth). We have introduced personal role radios. We have shown that we can be flexible and make very little of procurement of this kind, provided that we are sensible and seek upgrades in the future. That will enable all capability requirements to be met very satisfactorily.
	Like my hon. Friend, I pay tribute to the first-class facilities at Rosyth. Let me say in passing that a branch of the Defence Diversification Agency is located there, and is paying off very well in terms of interaction with local companies, technology exchange being its function.
	I was interested by what my hon. Friend said about the Babcock facilities in Australia and New Zealand for the repair of HMS Nottingham. We have not yet reached a decision, but I am sure that we are keeping Babcock in mind. I noted her concern about the future of the yard. Let me stress that it has proved itself to be extremely competitive, which should stand it in good stead when it is competing for work.
	My hon. Friend drew attention to the particular difficulties of making quick decisions about the cancelling of equipment that does not work and will not work. Long lead times apply to much of the equipment that we need. When a lot of capital has been invested and a project has been worked on for a long time, cancellation is very difficult to stop. I know that, because I had to cancel projects myself when I worked in the pharmaceutical industry.
	I do not need to spend much time on the A400M. As Members know, the problem is having to wait for a signature from the Germans, but we are convinced that it will come and that the programme will be finished on time. The German election is in September, and I do not think it will be delayed much beyond that.
	I think the points made about St. Athan by my hon. Friend the Member for Vale of Glamorgan (Mr. Smith) were answered by my right hon. Friend the Minister of State. If they were not, I shall be happy to deal with them.
	I have answered questions about Royal Ordnance in some detail in other Adjournment debates. We cannot discuss such matters as the level of stocks that we keep, because that is an operational matter, but I can say that we keep adequate levels to maintain any foreseeable operation. We are convinced that in different circumstances British Aerospace would be able to resupply.
	There is also the matter of developing insensitive munitions. New products are more difficult to introduce, but I pay tribute to the concern
	It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

DELEGATED LEGISLATION

Mr. Deputy Speaker: With permission, I shall put together the motions relating to delegated legislation.
	Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Tax Credits

That the draft Working Tax Credit (Entitlement and Maximum Rate) Regulations 2002, which were laid before this House on 9th July, be approved.

Tax Credits

That the draft Child Tax Credit Regulations 2002, which were laid before this House on 9th July, be approved.

Tax Credits

That the draft Tax Credits (Definition and Calculation of Income) Regulations 2002, which were laid before this House on 9th July, be approved.

Tax Credits

That the draft Tax Credits (Income Thresholds and Determination of Rates) Regulations 2002, which were laid before this House on 9th July, be approved.

Constitutional Law

That the draft Scotland Act 1998 (Cross-Border Public Authorities) (Adaptation of Functions, etc.) (Amendment) Order 2002, which was laid before this House on 27th June, be approved.

Treasure

That the draft Treasure (Designation) Order 2002, which was laid before this House on 3rd July, be approved.

Treasure

That the revised Treasure Act 1996 Code of Practice (England and Wales), a copy of which was laid before this House on 3rd July, be approved.[Angela Smith.]
	Question agreed to.

PETITION
	  
	Endometriosis

Anne Begg: I beg leave to present a petition organised by the Simply Holistic Endometriosis trust, a charity working to help women who suffer from endometriosis. It has been signed by more than 3,000 people.
	The petition was presented to me, in my role as chair of the all-party endometriosis group, by Diane Carlton, the chair of the SHE trust, during the recent lobby of Parliament held to raise awareness of endometriosis, which affects 2 million women in the UK. At present, there is very little public awareness of this devastating disease, and there is not enough funding available to raise knowledge among the medical community to improve early diagnosis.
	The petition states:
	The petition of the SHE trust, and others, declares
	That endometriosis is the only long-term chronic cyclical condition suffered by women, and that this devastating disease should receive higher priority for funding and treatment.
	The Petitioners therefore request that the House of Commons urge the Secretary of State for Health to review the Government's policy on the care and treatment of endometriosis sufferers.
	To lie upon the Table.

National Childcare Strategy

Motion made, and Question proposed, That this House do now adjourn.[Angela Smith.]

Caroline Flint: I begin by declaring an interest, as I am chair of the all-party childcare group. Before I entered Parliament, I was chair of the national campaign Working for Childcare, which used to be known as the workplace nurseries campaign. I was involved in that for 10 years.
	I have been trying to secure this Adjournment debate for some months, and I wondered whether my pitch had been spoiled by my right hon. Friend the Chancellor's wonderful statement this week on the comprehensive spending review. My scream of delight was apparently audible to a number of people when my right hon. Friend spoke of a radical extension of the national child care strategy in England.
	Why is child care important? It has a key role to play in the delivery of wider Government policy ends. The child care issue is about giving children a good start in life, helping to tackle child poverty, raising educational attainment and promoting better health. It is about helping parents into work, study and training. It is about meeting our welfare-to-work targets and helping with the family-friendly issue of work-life balance, which will increasingly become crucial to this country's economy and social life. The issue is also about raising qualifications andimportantlyraising family income.
	The question of child care goes wider than the family unit, however that unit is comprised. Whether two parents are involved or one, the child care issue is about supporting neighbourhood renewal and community development. It is also about tackling crime and creating healthy communities. Without child care, policies in those areas will not succeed.
	The national child care strategy was launched in 1998. It is the first such strategy ever to be undertaken by any Government, and I am proud, as a Labour MP, that it was a Labour Government who delivered on that. The aim was to create more affordable, quality child care, backed by significant new investment.
	There is no doubt that investment was put in, but some of the progress has been mixed. In terms of accessibility, there are now part-time nursery education places for all four-year-olds and, by 2004, there will be such places for all three-year-olds. However, they are part time, whereas working parents need the help provided by wrap-around care.
	The neighbourhood child care initiative aims to create 900 new nurseries in the most disadvantaged areas by 2004, along with more child minding and out-of-school places. However, progress in developing new nurseries that will be sustainable once funding runs out has been slow. There has been a growth in private day nurseries in response to a growing demand58 per cent. of women with children under five now workand out-of-school clubs, funded by the new opportunities fund, but there has been a fall in the number of child minders and pre-school playgroups. There are still significant gaps for parents with children under three.
	In terms of affordability, the child care tax credit is providing help with the cost of child care to 160,000 families. The average award is about 39 a week, and eligible families must find at least 30 per cent. of child care costs. Childcare fees went up by 10 per cent. in the last year, and a typical nursery place costs 6,200 a year. Some families, particularly lone parents who work less than 16 hours a week or use informal child care such as a grandmother or other family member, are not eligible.
	Ofsted took over the regulation of child care in September 2001 to provide consistent national standards. I do not think that anyone would disagree with that. However, the transition has held up registration and inspection of new providers at a time of growth.
	The inter-departmental review of the national child care strategy that the Government started at Christmas was both wise and warranted. We have seen some of the results this week. The review recognised that although so much has been achieved, it is sensible of any Government to review their policies to see where the gaps are and how they could be filled.
	The child care market is failing families and society. The market alone will not deliver affordable services to the majority of families without significant new investment on the supply side. Demand-side measures have not succeeded in creating new child care services. Funding and delivery mechanisms have often been criticised as too complex. There are too many unco-ordinated programmes with too many different short-term funding streams and, despite all the wonderful work that they do, expectations of what can be delivered by early-years development and child care partnerships are often unrealistic. Some 150,000 new staff are needed to expand services by 2004, but recruitment and retention are hampered by low pay, poor training and limited opportunities.
	The review of child care has been addressing some of these problems. I have included some of them in the review, as have other organisations. I am sure that Ministers involved in these issues have raised these problems as well. I am pleased and proud to say that the Chancellor's statement this weekmuch of which I am sure was linked to that reviewwas another step forward in the nation's child care and family agenda. This Government are the first ever to have a national child care strategy. It was particularly welcome after 18 barren years of Tory rule.
	This week the Chancellor announced the doubling of the child care budget to 1.5 billion by 2006, guaranteeing a nursery place for every three and four-year-old; 400,000 new sure start places; 250,000 new child care places; greater support for voluntary partnerships, which often underpin much of the growth at a local level; and a 200 million children's fund. In addition, 300,000 children will have access to children's centres. I congratulate the Daycare Trust, which has been pushing forward the agenda of children's centres.
	As a Member of Parliament, a child care campaigner and a parent, I believe that one problem is how we make the services that we provide visible and obvious to those who want to access them. If there has been a problem with the growth of services so far, it is how parents find the services they need. Parents do not fall into nice neat categories, all with children under five. They can have a baby, a toddler, an eight-year-old and a teenager. Anything that the Government can do to make it easier for them to know where to go for their child care, advice and health needs is to be welcomed. The children's centres will operate as a catalyst to bring these services together so that parents have greater access.
	The Government have listened to the problems faced in driving forward an agenda that has a role in different Departments. That is why I welcome the integrated budget, which will bring together child care, early-years learning and sure start. As a member of the Denaby and Conisbrough sure start, one of the trailblazers, it was obvious to me from the outset that sure start was not merely about health issues. I am proud that my local sure start scheme sees child care as part of the whole shape of its provision. More schemes are coming on-stream in Doncaster. We have a full-time day nursery as well as creche facilities and a pre-school toddlers group.
	I know that sure start is meant to cater for pre-school children, but some of the parents have older kids. Furthermore, in our community, unless we can engage some of the older children in what we are doing, they may take against us. They may make the building to which they cannot have access a target for petty vandalism. Our primary aim is to serve families with pre-school children, but we also want to engage with older children and with other young people in the community. I am pleased that those initiatives have come together. That is a sign that the Government are listening.
	I am also pleased that a new unit will be established in the civil service to drive forward child care policy. Such a unit is crucial to give advice to Ministers and to give an overview so that it can drive the agenda forward. It is definitely needed.
	I am a member of the local Doncaster early-years development and child care partnership which does much good work. During the past few years, I have been happy to speak to partnership groups at conferences organised by the Department for Education and Skills and the Daycare Trust.
	I was also glad to hear from the announcement that local authorities will be expected to have a greater role in delivering the targets that we need. That is right. Although there may be local authority representatives in the partnerships, authorities sometimes do not seem to know how to proceed and may leave things to the partnership. They have a key role in the community, not only as one of the largest employers but as an important agent for local change and delivery.
	The child care review clearly had some influence on the comprehensive spending review statement this week. I understand that the review will be published in the autumn. Will my hon. Friend the Under-Secretary of State for Work and Pensions confirm that? Will we have an opportunity to discuss the review in the House?
	I want to raise a few points that we should consider when drawing up future strategy and development. We need to flag up the fact that child care is as much an economic agent as a social provision. For some time, I have been putting questions about the role of regional development agencies and other bodies that have a remit to deliver economic regeneration and employment.
	I know that my right hon. Friend the Secretary of State for Trade and Industry agrees that those agencies should realise that child care is as important a part of the infrastructure for a newly growing economy as the transport that gets people to work. Childcare is as much a part of the supply chain as the providers of materials to factories or businesses or the catering firms who supply the restaurant facilities. It is an important part of the whole picture.
	If we want to reinvent ourselves in my region of Yorkshire and Humbersidecertainly, in respect of objective 1 in South Yorkshirewhat better way is there than to say, Come to South Yorkshire where you will find one of the best environments to raise your children, with the right services and the right jobs to support your work-life balance?
	I offer two local examples. Finningley is an RAF base in my constituency which we hope will become a regional airport in the future. My hon. Friend the Minister is nodding because Peel Holdings also runs Speke airport, which she knows well. Despite the fact that we do not yet have the go-ahead for the airport, almost 70 companies are working on the brownfield site. I am pleased to say that we also have a full-time day nursery.
	However, I am not pleased to say that when the developers of the site sought help from several agencies for start-up for the nursery provider and for refurbishment costs, they were fobbed off and told, You don't fit into this priority because you are not creating employment.
	I do not quite see how providing childcare jobs is not creating employment, or how sustaining people in employment through providing child care cannot count.
	Another problem was that because the brownfield site was not in a deprived communityas defined under the heading deprived communities in terms of fundingthose involved were told that they could not access the funding. That was the case despite the fact that, just down the road, is a defined deprived community, which would be the obvious source of much of the employment for the brownfield site. That issue must be looked at; brownfield sites sometimes are in deprived communities, but sometimes they are not. However, if jobs can be provided for people from such communities, I do not see why child care cannot be funded.
	The problems are not insurmountable. The problem is the mindset of those who work in economic regeneration, who see child care as a rather soft issue, rather than a crucial plankas I see itin our regeneration policies.
	Another example is the transport interchange for Doncaster, for which we were pleased to get Government support. I have been working for a number of years to get an understanding from the developers and others that if we are bringing together the train and bus stations in Doncaster, it would be a wonderful opportunity to create nursery provision near the site for those parents who might be commuting into Doncaster. That would be just like the facilities at Brighton and at Victoria, and a shoppers' creche could be provided for consumers. I am pleased to say that, only last week, the developers said that they were committed to making that happen.
	Is there a possibility that when the Government give the green light to very big infrastructure projects involving communities and creating employment, we could ask how they fit in with providing child care or other support to workers or consumers, whether they are public transport passengers or shoppers at a development? The Government can ask the question to see the answers that flow from it.
	We must do a lot more in terms of engaging employers. Some employers have done fantastic work; others are not sure how to get involved. That is where the RDAs, the trade unions, employers and chambers of commerce could be encouraged to play more of a role. Only one in 10 employers helps their staff with child care; only 5 per cent. of workplaces offer nursery places; only 5 per cent. of employers help towards child care costs.
	I want to raise a problem affecting low-income communities, and lone parents in particular; the use of informal child care. Despite everything, 50 per cent. of child care is informal. It is unregistered and can involve shift parenting, or the use of a family friend or other relative. We should look at the impact of that on the take-up of other services and at whether we should address this by bridging the gap between informal and formal care with some support.
	Will my hon. Friend the Under-Secretary look at the scheme in Northern Ireland that is run under the new deal programme for lone parents thereI know that that is a devolved functionin which lone parents on training or a work placement are allowed vouchers or money to be provided for registered child care and informal child care, if that is provided by a very close relative, usually the grandmother?
	Another scheme that I would bring to my hon. Friend's attention is run by Nottinghamshire county council where, again, for a limited period and in specific circumstancesI stress that these are targeted schemessome financial support is provided for families, some lone-parent, some two-parent, to enable them to engage in training or a work placement. Parents, particularly lone parents, who may be working less than 16 hours week and are not covered by the Government tax credits also receive help. It is worth looking into these schemes because some of our most needy families, through no fault of their own, might be missing a trick in terms of the Government not supporting them. I do not see that as a permanent measure, but we could consider it as part of our new deal for lone parents and support for low-income families.
	Finally, we have done an awful lot, and we should be proud of it. Given the different ways that we are delivering in England and how the issue is dealt with in Scotland, Wales and Northern Ireland, it should be clear to families throughout Britain that a Labour Government have spearheaded this agenda and made it such an exciting part of our work today in rebuilding our communities. In 10 years, I should like our targeted support to spread out like the ripples when a pebble is thrown into a pond, so that every family can recognise in different ways that Labour has delivered for families, whatever their status, background or needs.

Maria Eagle: I congratulate my hon. Friend the Member for Don Valley (Caroline Flint) on securing this debate. She is well known in the Housenot only among Labour Membersfor being a tenacious and knowledgeable supporter of improvements in child care, and her speech this evening demonstrates that very well. She has secured the debate at an auspicious moment, given the announcement made by my right hon. Friend the Chancellor of the Exchequer on Monday. Indeed, she made that point in her speech. Of course I agree with her that the debate is very timely.
	As my hon. Friend said so eloquently at the beginning of her remarks, child care is an incredibly important part of what the Government are trying to achieve. Quality child care gives parents choice and opportunity. It enables them to work and contribute to the economy confident in the knowledge that their children are in a safe and stimulating environment. So access to affordable child care also helps to reduce poverty and end the cycle of deprivation that we see in too many locations in her constituency and in mine. We know that getting a job is the best route out of poverty, and we need more child care in the most disadvantaged areas to help people to do that. Of course we all know that quality child care also supports children's development, which is equally important.
	The Government are therefore making the investment required. Since 1997, we have created nearly 500,000 new child care places, for more than 900,000 children. We have set national standards for the quality of child care provision, and Ofsted is now ensuring that all providers meet those standards. The neighbourhood nurseries programme will create 45,000 new day-care places in up to 900 state of the art nurseries by 2004. That is the biggest single investment in child care provision, and it amounts to 300 million in the three years to 2004.
	We have made a good start, but, as my hon. Friend clearly said, we recognise that we are not there yet; more needs to be done. The Government believe quality child care is a basic building block of modern society, so our aim is indeed to create affordable, accessible quality child care for all those who need it.
	The Chancellor made it clear in his announcement on Monday that, by 200506, the Government will be investing more than 1.5 billion jointly in child care, early-years provision and sure start, so funding for child care alone will more than double in real terms in that period. That will allow at least 250,000 new child care places to be created by 2006, including child care provided directly in new children's centres.
	New funding will be directed towards sustaining provision. As my hon. Friend said, provision is all very well, but it needs to be sustained. We want sustained provision in the most disadvantaged areas to support the growth of full day-care and out of school clubs and to provide grants for new child minders.
	We are aware that the Government need to make some changes to support this agenda, so we have decided to bring together sure start, child care and early-years provision into a single interdepartmental unit. Linked to that, we will devolve greater responsibility for funding and delivery of child care services to local authorities, and I was glad to hear my hon. Friend welcome that. Together, those steps will greatly improve delivery of that crucial agenda, out there on the ground where it matters.
	My hon. Friend referred to the child care review, and she is right that the interdepartmental review of child care, chaired by Baroness Ashton, has been working since last October. That clearly demonstrates the Government's commitment to taking a longer-term view of child care provision, to assessing our current position, and to examining the direction in which we need to move over the next 10 years. We will make sure that provision will be able to meet the changing needs of families over that period.
	The findings of that review were used, as intended, to inform the spending review announced by my right hon. Friend the Chancellor of the Exchequer on Monday. My hon. Friend is correct that the findings will be published in the autumn. In relation to her points about whether the House will have an opportunity to discuss them, that is not for me to say. I am sure, however, that my right hon. Friend the Leader of the House will take note of her comments. I am sure, too, that she has many ideas about how she might raise this issue on the Floor of the House and in other ways to give the House an opportunity to discuss it.
	One of the key recommendations of the review of child care was that children's centres should be established in all the most disadvantaged areas. Those centres will provide good-quality child care delivered alongside effective early-years education, family support and health services. They will thus be a part of transforming the way in which those services are delivered, to ensure that the needs of children, particularly the most vulnerable and their parents, are better met. They will reflect the early lessons that we have learned from the operation of sure start.
	The Government's longer term aim is to establish a children's centre in every one of the 20 per cent. most disadvantaged wards in the country. They will act as hubs within the community for parents and providers of child care services for all ages. The children's centre programme will build, where possible, on sure start facilities that already exist, and on other existing provision such as neighbourhood nurseries, to which I have already referred. By March 2006, we intend that an additional 300,000 children will have this improved access to health, education and other services.
	That will complement the greater role that schools will be able to play, following the enactment of the Education Bill, as bases of wider community and family services, including child care for older children. Schools, of course, can make a considerable contribution to child care. That sounds an obvious point, but they have great potential as a community resource, which we want to use more fully. Parents trust schools, and schools are good places to have child care provision. We want to build on the pilots and supported demonstration projects that we have seen in Brighton, Cambridgeshire and Durham.
	We want schools to see the contribution that they can make by offering access to services such as child care, family learning programmes and health care and how that can help the school deliver its own education agenda. That is why we are currently amending legislation to give school governors the power to provide those extra services.
	The vision is about much more, however, than centres and schools. Parents have a crucial role to play. Working with parents is at the heart of the Government's early-years education and child care policies. We are developing evidence of best practice to help early education and child care providers and their staff work well with parents. We are encouraging, too, the growth of positive links between parents and the professionals to whom they entrust their children.
	The Government want to get parents even more actively involved in their children's early education, whether that is volunteering to run after-school clubs, sitting on governing bodies, or attending training at local community centres. We also want to mainstream the acclaimed approach of sure start in actively encouraging parental involvement in all its programmes.
	My hon. Friend talked about informal care, and the Government recognise that parents, particularly lone parents, as she said, often have a preference for using informal, family-based child care. The child care review considered whether it might be possible to supplement what can be done within the formal child care sector with measures to support such informal care. I cannot be more specific at the moment, but I can assure my hon. Friend that that is an area that we are considering. Indeed, we have noted with interest the child care voucher scheme in Nottinghamshire, to which she referred, which has been running since 1992, and the support for family-based care provided within the new deal in Northern Ireland. Those provide helpful models when considering policy in this area, but they have not yet provided evidence of the impact of such measures on labour market or child development outcomes.
	There is, however, a simple answer to why the Government have not provided funding for informal child care so far. When we introduced the working families tax credit, we decided that assistance would be given for child care that had either been registered under the Children Act 1989 or accredited. That was to safeguard the quality of care.
	My hon. Friend made telling points about economic regeneration. We must ensure that child care is firmly on the agenda for all the agencies involved in regeneration. Child care is central to the process. It releases parents to work and to train, benefiting them, their children and their employers.
	Many early-years development and child care partnerships are working actively with the regeneration agencies in their areas and regions. There are good examples around the countryin Cambridgeshire, for example, where the local partnerships have been working actively with their regional development agency on the development of neighbourhood nurseries. There is awareness to build on. We are actively spreading good practice and working at a national level to move child care up the agenda.
	The Government's vision for child care is one in which every parent can access affordable, good-quality child care. We have made good progress towards that over the past five years. The child care review has allowed us to take stock and to look forward for the next 10 years. I am very pleased, indeed, to be able to confirm to the House that the spending review announced by my right hon. Friend the Chancellor of Exchequer on Monday has secured the resources needed for the next three years to take the process forward. We have charted the way ahead for transforming child care. I know that those hon. Members, such as my hon. Friend, who are interested in the subject will be watching and making suggestions about how we proceed. We are determined to go forward, and we are setting out to implement the plans that she mentioned. I congratulate her again on raising this important issue.
	Question put and agreed to.
	Adjourned accordingly at twenty-nine minutes to Eleven o'clock.

Deferred Divisions
	  
	Section 5 of the European Communities (Amendment) Act 1993

That this House takes note with approval of the Government's assessment as set out in the Financial Statement and Budget Report 200203 and the Economic and Fiscal Strategy Report 200203 for the purposes of section 5 of the European Communities (Amendment) Act 1993.
	The House divided: Ayes 275, Noes 179.

Question accordingly agreed to.